Hundreds of jobs saved after rescue deal struck at furnishings company

A RESCUE deal has been struck with administrators of Laidlaw Interiors Group (LIG), saving 390 jobs.

However, the fate of the remaining 579 employees remains uncertain.

The company, which has bases in Birmingham and Willenhall, has been partially bought by Valtegra, a European investment company.

It went into administration on Friday.

The acquisition covers Laidlaw’s Longden Doors, Cubicle Systems, Fitzpatrick and Komfort divisions (the last two being based in Birmingham).

The Willenhall-based Balustrading Solutions and Laidlaw Ironmongery divisions are not part of the deal. Administrators are still seeking a buyer for these.

LIG is a provider of doorsets, ironmongery and partitioning systems to the UK commercial interiors market.

It comprises of a total of seven businesses in the UK and also owns a door manufacturer in India and a sales office with warehouse in the Middle East. Its head office and main centre of activity is in Langley Mill, Nottingham.

Francis Milner, of Valtegra said “We recognised that there were viable businesses within the Laidlaw Interiors Group. We have a management team in place in each of the divisions which I am confident will enable us to create profitable and sustainable businesses going forward.

“This is a further exciting investment for us and a strong indication of our support for UK manufacturing.”

Richard Hawes and Clare Boardman of Deloitte were appointed administrators to Laidlaw Interiors Group and its subsidiaries late on Friday.

At the time of appointment, LIG employed 969 members of staff.

Administrators are now assessing options for the remaining divisions not covered by the deal. 

Joint administrator Hawes said: “The management of the group has been working hard to explore options to secure the future of all of its subsidiaries and, as administrators, we will continue those efforts.

“We are pleased to announce a buyer for just over half of the seven businesses, with no redundancies at this stage, and remain hopeful of achieving further sales post-appointment.

“LIG has been trading in some very challenging times, and whilst a number of businesses within the portfolio are profitable, the overall trading circumstances have become unsustainable.”

LIG was formed in August 2011.

The firm had endured some difficult years’ trading but had suggested the worst was over in accounts that were signed off in August.

LIG  reported a £25m loss in the 15 months to December 2014, following a £16.0m loss in 2013. Sales also declined, down £18m to £100m on an annualised basis.

But it said that its unaudited management accounts for July 2015 showed its first monthly EBITDA profit in two years, which it described as “a key positive milestone” – and said the group “is forecast to continue to be profitable from this point”.

Steps had been taken to restructure the company, cut costs and stabilise its finances. It had reorganised the company into two main divisions – a doors and ironmongery business and an interiors manufacturing business – and the workforce was reduced by one-quarter – around 350 jobs – in the last two years.

In November 2014, £13m was injected after the issue of new share capital while £35.2m of shareholders’ loans were converted into equity to create a positive balance sheet position.

In May, its major investor Rutland Partners put in another £2m and a further £2.9m was generated through a sale and leaseback agreement on its Langley Mill head office. These changes, and the “improved operational and trading performance” enabled it to negotiate an extension of its banking facilities with Lloyds Commercial Finance to December 2016.

However, the group began a sale process last month “as a result of a number of significant delays with several major contracts alongside other unhelpful external trading conditions”. With no deal concluded by last Friday, the administrators were called in. 

Law firm Shoosmiths led the deal announced today, providing insolvency and restructuring advice to Valtegra.

The Shoosmiths team was led by insolvency partner James Keates, senior associate Aaron Harlow, and solicitor Natalia Tombs.

Harlow said: “We were pleased to be able to work again with the Valtegra team in closing this transaction, which has saved many jobs in the week before Christmas.

“This investment will be a further boost for UK industry. This is our second successful deal for Valtegra this year, having completed a similar transaction in November.”

Valtegra is said to have provided significant investment to develop and strengthen the businesses it has bought.