Just one year after being bought by Cathay Investments, Cardiff haulier Rhys Davies has gone under after accruing “unsustainable losses” during the Covid-19 pandemic.
Ian Vickers and Philip Harris, partners at business advisory firm FRP, have been appointed joint administrators to Rhys Davies & Sons today (8 December).
In a statement the auditors said Rhys Davies, which was founded in 1952, “had been acquired by Cathay Group after a long period of losses and despite significant investment from its owners since acquisition, the Covid-19 pandemic has resulted in significant and unsustainable losses of revenue.
"The administration does not impact any of the other business in the Cathay Group.”
The statement added that “a number” of staff members will be made redundant with the remaining employees staying on to assist with the wind-down.
The administrators added that they are open to considering “serious” offers from interested parties looking to acquire the business and assets of the company.
They are also working with their agents to arrange for customers’ goods to be returned to them
Steve Baluchi of FRP said: “The impact of the pandemic has resulted in unsustainable losses for the company and left the directors with no option but to place the business into administration.
“We will now be focused on the orderly wind-down of the business and returning customers’ goods to them as quickly as possible.
“We are also working with staff to support them and help make any claims to the Redundancy Payments Service during what we recognise will be a difficult time.”
The Cardiff-based logistics and warehousing firm operated a fleet of 170 vehicles, including 150 trailers, and had more than 560,000sq ft of warehouse space across nine UK sites. It employed around 400 staff.
After being hit by the loss of two major contracts in 2017 and suffering serious operational disruption during the 'Beast from the East' storms in March 2018, the company reported losses of £8m in the 18 month period to 28 February 2019, on turnover of £55.3m.
In October that year Rhys Davies was bought by Cathay Investments for an undisclosed sum, as part of the Croydon-based investment firm’s strategy to expand into the UK logistics sector.
