Investors owed £9.4m from administration of fashion company

A report from administrators of Bradford-headquartered historic menswear retailer Greenwoods – which plunged into administration last year – has shed more light on the demise of the historic brand.

Due to the state of the company’s finances, the administrators at Deloitte said that secured creditors would not be paid in full. Pacific Trend Investment (PTI), an investment firm based in Hong Kong, was owed £9.8m at the time administrators were called in, with a further £11.8m owed as shareholder capital.

PTI received funds of £150,000 and £100,000 in 2018 and £175,000 is to be made available once all assets are realised – leaving a £9.4m shortfall.

Other than this, referential claims of £35,184 were paid in full on 19 May 2018.

The administrators said that insufficient funds would be realised to enable a dividend to unsecured creditors, other than an estimated Prescribed Part dividend of 4p in the £.

HSBC hold a debenture but confirmed there was no liability due to them from the company.

Upon appointment of the administrators, the company held 66 leases, 53 of which have been surrendered or expired.

In the report, administrators concluded that dissolution was still the best option, with little chance that an investor will step in and save the historic company.

The administrators said: “The administration was extended by secured and preferential creditors on 6 August 2018 and will now end on or before 5 September 2019. We do not anticipate that it will be necessary to further extend the period of the administration, unless further complications arise regarding the merchant services provider refund.”

Greenwoods first went into administration 18 months ago by Versatile International Trading. The deal saved 40 retail stores and protected 181 jobs, but 22 stores closed immediately, resulting in 88 redundancies.

Greenwoods reported a turnover of around £20m in 2017. It offered a formal suit hire service, under the Company’s “1860” brand. Greenwoods operated from 63 stores and two concessions throughout the UK in 2017, with its head office and warehouse located in Bradford.

The Bradford-headquartered company was founded by Sir Willie Greenwood. At its peak, Greenwoods had around 200 shops across the country.