The family-owned Leicester business collapsed into administration at the end of February.
It had provided a range of print services including litho, digital and point-of-sale, and had recently moved into rigid box making.
Reports from administrators at FRP Advisory reveal that the business had made a small net profit of around £32,000 on growing sales of £4.2m in the six months to 31 October 2023.
However, the firm’s cash position became “tight and unmanageable”.
Options to raise further funds, including investment from shareholders and an MBO, proved unsuccessful and FRP ended up running an accelerated sales process for the firm's business and assets.
Greenshires directors Marcus Cross and Richard Dalby, who were respectively the MDs of its PoS and litho operations, made a pre-pack offer via a newco but “at the final hour” terms between the duo and funders could not be agreed so the deal fell through.
Other purchasers – with 26 signing NDAs – were put off by the amount of capital that would be required immediately, and by the strictures of a long lease on its factory.
Greenshires employed 56, including the directors, when it went into administration on 26 February and had just £4,711 in its bank account.
The estimated total deficiency to unsecured and prescribed part creditors is £2.3m.
Unsecured creditors are owed £985,342 while employees’ unsecured claims total nearly £1.02m. Most of the firm’s employees were long serving.
Secured creditor Aldermore Bank was owed £357,000 and will be repaid.
Most of Greenshires’ plant and machinery was subject to a £1.9m fixed charge with Close Brothers Asset Finance.
The business had also received taxpayer-funded support via the CBILS and Recovery Loan Schemes to help it through the Covid-19 pandemic.
Secondary preferential creditor HMRC is owed around £382,000.
The non-financed machinery was sold by Gordon Brothers and brought in £99,100.
Brown Knight & Truscott acquired the customer list for £3,250.
Greenshires was owned by second-generation members of the Yell family, having originally been established by John Yell in the 1960s.
According to the report sales in the year to 31 March had increased to £7.67m from £6.5m the prior year, but profits were minimal at £90,000 (2022: £14,000).
