Directors at RAP Spiderweb Ltd appointed joint administrators Richard Cole and Steve Kenny of KBL Advisory, Sale on 2 May.

The company’s statement of affairs, signed and dated 5 June 2023 by registered director Diane Horsfall and uploaded to Companies House earlier this month, revealed that its estimated total deficiency as regards members was just shy of £1.52m.

78 trade and expense creditors of RAP Spiderweb Ltd were owed nearly £186,000 while 13 employees and directors were owed just over £192,000.

Unsecured non-preferential claims also included nearly £705,000 to The Commercial Centre Ltd, a connected registered company that shares three common directors with RAP Spiderweb Ltd – Horsfall, James Tattum, and Lynn Buckley, and which owned the entire issued share capital of RAP Spiderweb Ltd.

Earlier this week, the company’s statement of administrator's proposal was subsequently filed at Companies House and revealed the events leading up to the company’s administration and closure.

It said the business had, in recent years, been impacted by the Covid-19 pandemic, which created a decline in turnover due to a drop in demand from its customer base, with charitable events [its customers included charities and the not-for-profit sector] taking the longest to be safely restarted.

It was subsequently unable to achieve turnover in line with its pre-pandemic levels as many customers had moved to digital alternatives.

The business had obtained two Coronavirus Business Interruption Loan Scheme (CBILS) loans during the pandemic from Close Brothers Asset Finance, the original loans amounting to £481,700 and £649,000, and the latter was secured against a Komori GL29 four-colour press plus coater.

These loans assisted with the working capital requirements during the pandemic, and the business also made use of the Coronavirus Job Retention Scheme.

The war in Ukraine that began last year resulted in “increased energy costs, rises in paper prices and the company’s credit facilities were reduced by suppliers due to economic uncertainty”, creating significant cashflow issues for the company, the document stated.

The directors of the company subsequently approached KBL in March 2023 and a review of its financial position was carried out that established it had limited working capital to continue to trade.

The secured creditor, White Oak No.6 Ltd, provided funding for critical payments throughout April 2023 to enable the business to work out existing orders without worsening the position of any creditor.

A wind down administration was considered to be the preferred option and the directors proceeded to formally engage KBL to assist with this process on 26 April. The business subsequently ceased to trade on 28 April and all staff were made redundant.

The administrators said that upon their appointment, the value of the company’s sales ledger was £158,690, but White Oak had advised that a number of these were not collectable as they had gone into liquidation, and the estimated to realise value was therefore £103,474.

Its plant and machinery had a book value of £73,739. These assets were put into auction by JPS (Surveyors) and £46,134 was realised. It’s unclear what these included but RAP Spiderweb had also operated kit including a four-colour B2 Heidelberg Speedmaster and a B2 Cron platesetter as of 2021.

A small quantity of stock was also sold via the auction, realising the sum of £651.

Company accounting records suggested that just over £1.72m was owed by Printingco Holdings Ltd, a connected company by way of the common directorship of Tattum and Horsfall.

A further £153,702 and £709,631 were owed by Rochdale Alternative Press Ltd and Barking Dog Productions Ltd, respectively, two companies also connected by the common directorships of Tattum and Horsfall.

The administrators have instructed solicitor Aaron & Partners to assist with pursuing these debts.

KBL added: “The joint administrators made immediate contact with the company’s bankers in order to freeze the company’s bank accounts and to request the transfer of any credit to the joint administrators’ control, however no realisations are expected as there was a negligible credit balance and this is likely to be set off against the outstanding Bounce Back Loan.”

It is anticipated that the secured creditor will be repaid in full from the assigned book debts and that there will be sufficient funds for a distribution to the preferential creditors.

Digital and B2 litho print operation RAP Spiderweb was formed in 2006 when Rochdale Alternative Press, which was founded in the 1960s, bought London-based printer Spiderweb.

The statement of administrator's proposal showed that the business had a turnover just shy of £1.32m for the year ended 31 August 2022 and a pre-tax profit of £68,077.

At the time of writing, KBL had not responded to a request for comment.