|D&D Wines creditors meet administrator today in search of £10.5m owed|
|Written by Chris Mercer|
|Friday, 29 June 2012 09:57|
Tension will be running high today when creditors of collapsed wine agency, D&D Wines, meet the administrator in the hope of clawing back some of the £10.5m that is said to be owed to them.
RSM Tenon, D&D Wines International's admnistrators, is confident of selling the collapsed firm's leftover stocks, but creditors may still lose millions of pounds.
Its list shows that Spanish wine firm Bodegas Muriel is owed £2.8m, while fellow Rioja wine producer Bodegas Eguia is owed almost £1.25m. French wine group AdVini is owed £1.28m and Champagne Martel is short of close to £800,000.
Their chances of repayment are hanging in the balance. In a report filed at UK Companies House, Tenon said a lack of buyers mean it has ceased trying to sell D&D as a going concern.
As a result, it is trying to raise as much cash as possible by selling off D&D's existing stock and assets, as part of an "orderly wind-down of the company's affairs".
A Tenon spokesperson told Harpers: "We expect wine stock sales to complete in the next four-to-six weeks. We've sold £1m already and there's about £600,000 to go." Only three employees out of an initial 27 are left at the company.
Even if Tenon's best estimates are realised, its report still estimates a £6.5m hole in funding for unsecured creditors.
Tenon is currently embroiled in a dispute with one unnamed retailer over monies owed, according to its report.
The administrator estimates that D&D was £407,000 in the red for its fiscal year-to-date when it fell into administration on 20 April. In 2011, net profits sank to £10,000, from an estimated £382,000 in the previous year. D&D's net sales peaked at £50m in 2007, but have fallen since to due loss of key contracts.
Several executives completed a management buyout in January 2011, acquiring the company from owners David and Myra Garlick. Yet, the group's finances unravelled further in late 2011 after major overseas suppliers began to invoice retailers directly.
At the same time, D&D found its access to cash squeezed with working capital tied up in stock, Tenon said in its report.