Abbey Logistics and Lomas Distribution paid close to £300,000 for the majority of the bulk powder and warehousing business of collapsed operator Seafield Logistics.
The combined sum has been revealed in a recently published progress report from Grant Thornton, which was appointed as administrator of the former MT Top 100 firm on 11 June 2014.
The report, which covers the period from appointment up to 10 December 2014, reveals Abbey Logistics paid £187,000 for the majority of Seafield’s bulk powder operation – last year (MT 23 June) the operator revealed it had taken on Seafield’s Winsford, Middlewich and Immingham bulk transport operations as well as boosting its fleet by 47 trucks and 57 powder tanks.
Lomas Distribution, which acquired the Winsford warehousing business of Seafield and the palletised transport operation for an unnamed, ‘large customer’ of the collapsed firm, paid £96,017 (including a deferred consideration of £20,000 of goodwill).
The report also revealed that Green Group, which in July 2014 secured the lease for what had been Seafield’s 250,000ft² warehouse in Worksop, paid £5,000 for certain undisclosed assets located at the site.
Seafield has now entered creditors’ voluntary liquidation, which is being handled by Grant Thornton.
Grant Thornton added that it now estimated unsecured creditors of the business would receive 17.2p in the pound (or £1.52m in totality), a reduction on the 22p in the pound it initially estimated.
Seafield's demise
In its statement of affairs from last year, Grant Thornton said a sale of the business as a going concern had not been possible after major customer Tata Chemical Europe terminated its contract with the firm giving notice that Agility Logistics Solutions would replace it as its logistics provider from 21 May.
Seafield had provided Tata with logistics and warehousing services from its Winsford site, and months before its collapse had increased its dependence on Tata after it opened a new Immingham hub in March 2014 to store sodium carbonate imported from the US.
Tata itself had taken action after Seafield’s directors had been forced to issue a Notice of Intention to Appoint Administrators on 16 May 2014. The termination did not affect the warehousing services Seafield undertook for Tata but removed some 60% to 70% of the operator’s turnover, leaving the business unviable.
Grant Thornton ascribed much of the company’s losses, £395,000 in its audited 18 months to 31 December 2012 accounts and an estimated £1.2m for the year to 31 December 2013, to the underperformance of its Tata contract. This had led to “significant underutilisation of the assets of the business which could not be recovered through the commercial terms of the contract”.
Seafield’s management said this had led to a chronic cash shortfall and the ultimate failure of the business.
At the point of entering administration last June, Seafield owed trade creditors £3.1m. Both Abbey and Agility were unsecured creditors and were owed £91,027 and £302,634 respectively. Other creditors included Norbert Dentressangle, which was owed £186,124 at that point.
