Cost of Lexi investigation nears £10m
THE administrators’ bill for handling the collapse of Lexi Holdings will soon top £10m.
The latest progress report by accountants Richard Fleming and Brian Green of KPMG shows the firm’s charges covering three years’ work stand at £9.83m – 38,693 hours at an average hourly rate of £254.
The case, which has involved negligence claims against Lexi’s former advisors, court judgements against former directors and injunctions over assets held oversees, has also racked up legal costs of more than £10m.
The final bill for professional services will eventually be much higher as the investigation will continue until October 2011 after KPMG won a High Court extension to its appointment last month.
The Manchester property business collapsed in October 2006 with debts of more than £100m, weeks after managing director Shaid Luqman – once an award-winning entrepreneur and a frequent member of national newspaper Rich Lists – was banned from acting as a company director for a maximum of 15 years for his conduct in running another business, Modern Living UK.
Mr Luqman was recently released from prison after serving a second sentence related to the demise of the company. The disgraced one-time tycoon was jailed for 12 months in March for failing to comply with various court orders relating to Lexi’s collapse.
Mr Luqman, his father and three siblings are facing court judgements for debts worth a total of £260m. Judgements have also been obtained against 15 related parties and associates as the administrators seek to claw back assets. Administrators are now chasing assets in Pakistan.
So far KPMG has recovered £33m and paid out some £30m, much of this spent on various fees. A syndicate of banks is owed around £100m which received a £1m return in the six months to October.
