The Redditch point-of-sale company was placed into administration on 24 July by its new owner Landry Kouakou, four months after he acquired the firm as part of a £6m deal with St Ives for its wide-format businesses.
He cited a number of issues as leading to the administration, including the decision by a major customer to re-tender its work early.
The report from joint administrators Allan Graham and Matthew Ingram at Duff & Phelps states that management accounts at SP Group show the business had sales of £45.4m and made a £2.6m loss in the period to 30 June.
Upon appointment the business had 306 employees, with an additional 79 employees on gardening leave as part of the restructuring of the business instigated under the new ownership.
These 79 employees together with 114 of the existing staff were made redundant when the administrators were appointed, with a further 103 staff let go when the business ceased to trade at the end of July and the remainder leaving during the winding down process. Two employees have been retained to help with the collection of book debts and the sale of SP’s assets.
Finance firm Sitara was the group’s secured creditor, and holds a fixed and floating charge over SP Group’s book debts, as well as its plant and machinery.
According to the Duff & Phelps report, £10.3m of book debts were owed to the business, of this £2.4m was funded, almost £3m was unfunded, and £4.9m was due from Kouakou’s acquisition vehicle, SelmerBridge.
“As SelmerBridge is the group holding company with no assets apart from the shares it holds in the group companies, it is unclear whether it will be able to repay its debt,” the report stated. “An update will be provided in our next report.”
Pension contributions taken since the change of ownership, and during a period when no alternative scheme had been set up, have been placed in a trust account and will be transferred to the previous scheme, the administrators said.
Unsecured creditors are owed £4.93m, including a host of industry suppliers as well as printers and finishers.
Sister company Service Graphics, acquired at the same time as SP by SelmerBridge, was the biggest-single creditor listed, and was owed more than £614k. However the books show that Service Graphics is also owed £317k by SP, so set-off will apply.
Other major industry creditors included Pyramid Display Materials, which was owed more than £250k, while London pre-media and content specialist Born Group was owed £189k and YM Group’s Lettershop subsidiary £175k.
Duff & Phelps said it was not currently possible to say whether unsecured creditors would receive any form of payment.
The online auction of SP’s remaining kit is being handled by European Valuations and will take place next week.
“We sold the two KBA presses and the Komori pre-auction,” explained valuer Joe Hall. “The viewing day is next Tuesday and we’re seeing pretty strong interest. As far as print assets go, these are all very well-maintained and it’s a nice mix of equipment.”
The lots include an HP Scitex FB11000 six-colour large-format flatbed printer, and an Inca Onset S40i as well as a large amount of finishing kit.
Duff & Phelps said that an independent third-party buyer acquired the software used by SP for £25k in a separate deal agreed earlier in the process.
