E-cigarette business VIP goes into administration
Manchester-based premium e-cigarette business VIP has gone into administration but will continue to trade across its 165 retail outlets and retain all 265 staff while a buyer is sought.
According to the company’s American owner which bought VIP for £30m three years ago the failure of the company relates to an unsatisfied tax obligation of about £2.5m owed to HM Revenue & Customs.
Anthony Collier and Geoff Rowley, partners at FRP Advisory, have been appointed as joint administrators to Mush Have Ltd – trading as VIP.
Collier said: Anthony Collier, joint administrator and partner at FRP Advisory, said: “VIP is a strong and well established brand in the e-cigarette market.
“Historically the business has been profitable and cash generative and we are seeking to continue to trade the business whilst a purchaser is sought and invite interested parties to contact the administrators.”
VIP is a subsidiary of US company Electronic Cigarettes International Group.
It was for £30m bought nearly three years ago from Shareholders Miguel Corral and David and Melanie Levin.
“Despite multiple attempts to satisfy the tax obligation and other expected near term obligations, the company is unable to continue to fund the operations or any obligations of MHL,” said ECIG chief executive Dan O’Neill.
“Based on the administration process in the United Kingdom we will be evaluating the strategic alternatives available for the future of the company,” stated Dan O’Neill, ECIG’s CEO. “Legacy financial commitments and MHL’s underperformance in the UK prevented the subsidiary from meeting its financial obligations.”