Struggling debt manager sold to rival

A FORMER Ernst & Young Entrepreneur of the Year has sold the debt management book of his Wilmslow-based company TCF Debt Solutions prior to appointing a liquidator.

Andrew Moody, who was named as Ernst & Young’s Emerging Entrepreneur of the Year in 2007, sold his company’s debt management book to Sale-based Patronus Group last month. According to Patronus director Chris Davis, the deal – which involved Patronus Group taking on eight former members of TCF’s staff – concluded on July 9.

Patronus, which also owns a number of other debt management companies including Chiltern Debt Management, The Debt People and Hamilton Locke, has also agreed to pay outstanding commissions to TCF’s network of brokers.

“While not legally obliged to do so, we’ve stepped in to ensure that the brokers aren’t out of pocket,” said Davis. He added that he hoped the payments would  “ensure good relations” with TCF’s broker network would continue, and that the deal would not have an adverse impact on TCF’s customers.

However, TCF’s creditors have subsequently been sent letters from Manchester-based insolvency practice Clarke Bell on July 21 informing them of TCF’s intention to appoint it as liquidators. A creditors’ meeting has been convened for this Friday, August 6.

Moody received his Entrepreneur of the Year at his previous company, loan brokerage firm Loanoptions.co.uk, after generating profits £1m on sales of £8.9m in 2007 – just three years after founding the business.

However, it was hit by a collapse in demand and product availability once the credit crunch ensued and the company collapsed a year later with debts of £380,000. Moody bought back the business from administrators using another of his companies, Merchant Business Finance, but it too was forced to close its doors in 2009.

Bev Budsworth, managing director of Trafford-based insolvency firm The Debt Advisor said it was “unusual” for a sale of a company’s assets to take place prior to the appointment of liquidators, as there is a danger that such transactions could be detrimental to certain categories of creditors.

Clarke Bell did not respond to calls for comment.