How much luxury kitchen maker Harvey Jones owed to its creditors when it rescued out of administration in a pre-pack deal last month has been revealed.
More than 100 jobs were saved when a fund managed by RBC BlueBay Asset Management acquired the London-headquartered business.
Now a new document from administrator Interpath Advisory has revealed how much the company owed, how much it was sold for and the full details behind why it collapsed.
Why did Harvey Jones need to be rescued?
Interpath Advisory said that during late FY22 and early FY23 the company’s management noted that the order book was “unreliable due to the high level of cancellations and delays significantly impacting the liquidity and cashflow of the group”.
The firm added that this, “coupled with a fall in revenue in FY22, compared to FY21, resulted in a significant liquidity strain on the business.”
Interpath said: “Commercial measures were implemented by management to improve cash flow and stabilise the order book, including increasing the customer deposit structure in line with industry standards, reducing overheads and manufacturing costs.
“However, despite the measures taken, due to a decline in customer demand the group generated an EBITDA loss of £3.8m in FY23.
“As a result of this loss and the worsening cash position in the business, Interpath were introduced to the business in January 2024 to explore the restructuring options for the business.”
When Harvey Jones was rescued, the purchase price was not disclosed. However, Interpath’s document has revealed the price was £400,000.
How much did Harvey Jones owe?
The business had been funded by a Coronavirus Business Interruption Loan (CBILs) facility from Alice Bank and a secured shareholder loan from Coniston Capital Management LLP.
When Interpath was appointed, Allica’s indebtedness was £800,000 and Coniston was owed around £6.1m.
As part of the sale of Harvey Jones, it was agreed that all customer deposits would be honoured by the new owner which reduced the potential creditor claims by £3.6m.
Interpath said that it anticipates that there will be a “small distribution” to the first ranking secured creditor, Allica Bank, “however we do not expect them to recover their debt in full”.
The firm added that there will not be a dividend to secondary preferential creditor HMRC which is owed £1.4m.
There will also not be a pay out to unsecured creditors who are owed £9m.
What has Harvey Jones said about its rescue?
Harvey Jones has showrooms in Battersea, Bath, Birmingham, Bournemouth, Brighton & Hove, Bristol, Cambridge, Cardiff, Chester, Chichester, Chislehurst, Edinburgh, Guildford, Hampstead, Harrogate, Islington, Marlow, Milton Keynes, Notting Hill, Nottingham, Oxford, Sheen, St Albans, Tunbridge Wells, Wilmslow, Winchester and Worcester.
The company was founded in 1977 and its kitchens are all handmade in Cambridgeshire.
In a statement released when it was rescued, Harvey Jones said the new investment will “accelerate the strategic transformation” of the company with “further product and omnichannel development in the premium kitchen space as well as optimising reach for additional areas in the home”.
It added: “Brand awareness will be further strengthened with our ongoing support and collaboration with our new strategic brand partners across both consumer and trade.
“The investor will work closely with the management team at Harvey Jones to support the development of the brand.
“Harvey Jones intends to continue with its growth strategy and recent product introductions have been very well received by new and existing customers to date.”