Please visit http://www.companyrescue.co.uk/ for confidential help and insolvency advice or email keiths@ksagroup.co.uk

Wednesday, 8 June 2011

Life and Style in administration (update)

Ethel Austin's successor, Life & Style, is in difficulties  See our post on Ethel Austin going into administration for the second time last year.

Life & Style was created in March last year, after it bought the trade name and assets of Ethel Austin which has had its base in Merseyside.   The company had 91 former Ethel Austin stores.
This was the second time that the Managing Director of Life and Style, Elaine Mcpherson,  had bought Ethel Austin from administration. The chain first collapsed in May, 2008.

Update 10th June:  The firm has now gone into administration with RSM Tenon acting as administrators.  It is thought there are buyers interested in the 150 strong chain

So is this the only way to protect a business against winding up petitions and the like?  Not exactly.  A company voluntary arrangement or CVA can also protect the company.  It is quite technical but take a look at our CVA moratorium page on the subject.

In 1995 case law was reported that provides a very powerful argument to stop legal actions. Re Dollar Land (Feltham) & Ors [1995] BCC 740 reported that the court decided that a winding-up order should be rescinded if there was a real prospect that CVA proposals would be approved by the company's creditors. In other words let the CVA majority decide.

In this way a CVA can protect a company.  However, a draft CVA proposal does take a little time to get together, So it is important to take advice EARLY if you are suffering problems.

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Many thanks for your comments. If you have a private business problem and you want advice give us a call on 0800 9700 539 or email me at keiths@companyrescue.co.uk. If you are a professional advisor with a troubled client, please suggest they visit www.companyrescue.co.uk or contact me as above.

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