Wool Manufacturer – Administration and Pre-Pack Sale
Moorfields were appointed as Administrators over a UK-based wool manufacturer, the largest wool spinner in the UK and part of a European group, with an annual turnover of approximately £45 million.
The business had been servicing loss-making group entities at the detriment of the UK lender’s security. The group had previously engaged a Big 4 accountancy firm to explore restructuring options, but progress was limited, and the lender required intervention to protect its position.
The company’s ABL facilities totalled £6 million (secured against property and plant & machinery), with an additional £8 million CID facility at 90%, necessitating a structured approach to preserve value, protect jobs, and maximise recoveries.
Objectives
- Stabilise the UK operations and secure ongoing trading while pre-pack options were explored
- Protect the bank’s security and recoveries, minimising exposure to unsecured group obligations
- Maximise asset realisations through a structured sale or pre-pack solution
- Preserve the business and employment where possible
- Deliver a compliant and controlled Administration process
Moorfields’ Actions
- Engaged immediately with management and the bank to focus on UK operations and pre-pack sale options
- Stood down the Big 4 advisor, streamlining the process and reducing complexity
- Ran a three-week accelerated marketing exercise, attracting interest from strategic buyers
- Limited bank funding to less than £500,000, while recovering over £2 million of debts, improving lender exposure
- Coordinated closely with management and stakeholders to stabilise trading, maintain customer confidence, and preserve jobs
Results
- The business was successfully sold via a pre-pack for over £7 million
- Bank loan facilities were repaid in full, with the debtor book projected to satisfy the CID facility entirely
- Jobs and ongoing business operations were preserved, maintaining continuity for employees and customers
- Moorfields’ process maximised recoveries, safeguarded lender security, and delivered a compliant and efficient exit
