Pension Protection Fund bidding to force BHS liquidation
THE administrators of BHS have retaliated after it emerged that one of the high street retailer’s biggest creditors – the Pension Protection Fund – is attempting to force them to put the company into liquidation.
A progress report by the administrators of SHB Realisations, formerly BHS , revealed they are embroiled in an escalating row with its biggest unsecured creditor, the PPF.
The PPF is attempting to force administrators to place the company into a creditors’ voluntary liquidation.
The PPF is responsible for paying out retirement funds to thousands of BHS employees. It is demanding that BHS be liquidated by November 24 with the retailer’s other administrators FRP Advisory then taking over as sole liquidator.
The progress report to creditors covers the time period from when administrators at Duff & Phelps, Philip Duffy and Benjamin Wiles, were appointed on April 25, to October 24 2016.
The administrators argued that forcing the company into a CVL would mean that creditors do not get the best deal.
They said that asset realisations are still ongoing and that a CVL would have a “detrimental effect” on the overall realisations for creditors, though admitted that quantification of this was difficult.
It also said that unsecured creditors would be lucky to get 8p in the pound returned to them following the collapse of the high street retailer.
They said that a CVL is “not imperative” at this stage, and that it made “no sense” for a new liquidator to take over – calling it a duplication of effort and cost.
Administrators said that they needed more time to realise a sale of the company’s assets and allowing online trade to realise stock value citing the sale of its international business for £2.5m
They said that they expect enough to be realised to enable monies to be distributed to non-preferential creditors.
The report went on to say that the last interested party backed out on June 2, leading to the controlled wind down of the business. The final store closed on August 28 2016.
All 163 trading stores were closed down, risking 11,000 jobs. A pension bailout by former owner Philip Green is set cost the billionaire around £300m.
Malcolm Weir, the PPF’s head of restructuring and insolvency, told Sky News: “We are intent on securing the best possible recovery on behalf of the pension schemes from the insolvent company.
“Given that the company has not traded since August, we believe a liquidator will be able to progress all remaining issues at least as quickly as the current administrators, including the remaining leases and the ongoing investigatory work.
“This will expedite the investigations and reduce costs, and it is therefore in the interests of pension scheme members and our levy-payers to do this promptly.”
