Red Driving School's parent firm in administration

LVG, the parent company of driving instructor business Red Driving School, the UK's third largest, has gone into administration.

However administrators MCR said they had already received a number of offers and a buyer could soon be unveiled.

LVG employs 400 people in total across three offices, but all the Red Driving School drivers are franchisees.

It also owns two other businesses under the Red brand - Red Instructor Training and Red Fleet Training.

Red Instructor Training trains would-be driving instructors, and Red Fleet Training is employed by companies to test and improve the driving skills of their employees.

'Profitable operation'

LVG's 400-strong workforce includes 200 people at its head office, and 150 spread across two "operational support facilities" in Liverpool and in Billingham near Middlesbrough.

"We are confident a buyer will be secured as the most recent financial reports indicate the business has been quite a healthy and profitable operation." said joint administrator Andrew Stoneman of MCR.

"It only entered administration due to a lack of funding and investment."

Posted at 10:31PM Feb 18, 2010 by Kelly Board in Insolvency  |  Comments[0]

Burberry Set to Cut Jobs

Fashion designer Burberry has announced that they plan to restructure their Spanish operations after blaming it for the large loss they made in the previous financial year.  The new structure will see around 300 redundancies.

Currently, the UK based firm design and sell exclusive collections in Spain that they do not sell in any other country, they are planning on changing this an only selling their global collection after Autumn/Winter 2010.

Burberry has tried to maintain a different image in Spain compare to other countries, they have always operated as middle-to-upmarket whereas in the UK and other countries they have always been a luxury brand.

As a result of the changes, their Barcelona facility is due to be closed later this year.  They have announced that once the changes are implemented, their pre-tax profits will remain ‘in line with expectations.’

Cost Cutting

As mentioned, Burberry blamed their recent poor performance on their Spanish brand after reporting a £16.1million loss for the year to 31 March 2009.  Around that time, the company were trying to implement a £50million cost efficiency programme.

Further job cut are also expected both in Spain and here in the UK due to the close of their ‘Thomas Burberry’ line.  It was announced last month that this may see as many as 290 cuts in the UK along with a further 250 in Spain.   This comes despite already reducing their Spanish work force by around a third in the last year.

Posted at 10:22AM Feb 18, 2010 by Marc Stenton in Insolvency  |  Comments[0]