Fewer road traffic accidents partly to blame for collapse of credit hire business EDAM

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A drop in the number of road traffic accidents and delays in the availability of car parts are the key factors behind the collapse of a Manchester-based business.

Administrators from Interpath have been appointed to EDAM Group Limited, which provided credit hire and post-accident repair services to motorists, often through intermediaries such as insurers.

Ryan Grant and Rick Harrison of Interpath Advisory are now acting as joint administrators of the business and two related companies, Easi-Drive Ltd and Credit Repair Ltd.

EDAM Group employed 195 staff at its head office at Sharston, south Manchester, a support office in Sunderland and four depots, but 101 were made redundant on the appointment of the administrators, who are now working to wind-down the companies’ operations. 

Funders Trinity, Leumi and Toscafund have registered charges against the companies. 

In its last set of filed accounts at Companies House for the year ending 31 March 2023 EDAM reported a sharp drop in turnover to £26.5 million, down from £36.6 million the previous year. 

Pre-tax losses had grown to £3.3 million last year from £2.05 million the year before. The business was deemed a viable going concern, but largely due to the support of its funders. 

The directors blamed the drop in business on factors such as the impact of the Ukraine war on the global supply chain, which affected the time it has taken to source parts to repair cars.

Over the last four years the board explored all options, ranging from a full sale, investment, refinance and restructuring options following a sustained period of challenging trading conditions witnessed across the wider credit hire market. 

However, in the absence of a viable option, the EDAM Group was unable to meet its financial obligations appointed administrators.

Ryan Grant, Managing Director at Interpath and Joint Administrator to Easi-Drive Limited, Credit Repair Limited and EDAM Group Limited, said: “Like many players in the credit hire market, EDAM Group has faced challenging macroeconomic trading conditions following structural changes to road traffic volumes encountered since the pandemic, as well as the associated supply chain impact on the UK garage network.

“We have commenced an orderly wind down of EDAM’s operations, while also supporting those employees impacted by redundancy, providing them with resources and guidance to file the appropriate applications to the Redundancy Payments Office.”

The administration does not include Garvins Law, the credit hire litigation specialist, which remains independent and continues to trade as normal.

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