Vantis Nearing Administration
It is thought that the troubled top 20 accounting firm Vantis is on the verge of entering Administration.
Vantis said it is preparing a market statement amid mounting speculation that it is about to ‘bite the bullet’ and appoint Administrators.
The firm had its shares suspended last month, after it said it could not be certain of sufficient funding to continue as a going concern. Sources close to the firm say the business could enter Administration as early as Wednesday morning.
A senior insolvency practitioner has said that rival firm Tenon is considering acquiring parts of the firm’s London business. The firm’s business recovery department, in London, may be bought by three former Vantis insolvency practitioners.
Speculation in the industry has focused on insolvency practitioners Jeremy French and Geoff Rowley as two of the three potential buyers.
The firm has been under pressure, in part due to its failure to cure fees from to its troubled Administration of Stanford International Bank, operated by Texan Allen Stanford.
In June liquidators from Vantis working on the Stanford case were removed from their posts by an Antiguan court. The firm appealed the decision.
It is understood the rest of Vantis could be broken up and separate local practices sold to existing managing partners.
FTI Consulting has been advising Vantis, it remains to be clarified whether they will be appointed administrators.
Posted at 04:37PM Jun 29, 2010 by Marc Stenton in Insolvency | Comments[0]
Corporate Insolvencies Drop Again
The number of company collapses is expected to fall short of predictions for 2010 after the rate of business insolvencies fell again in May.
There were 1,491 in May, 18 per cent lower than in April and 24 per cent below the figure for May 2009, according to Experian, the data company. Company failures in the first five months of this year totalled 8,729 against 10,835 during the same period last year.
However, the economy is bracing itself for more pain according to the widely-held belief that the number of collapses will rise as the UK steers itself through the recession.
Experian said that last month’s performance was due to a vast month-on-month and year-on year improvement among medium sized businesses with 51 to 100 employees. However the biggest increase in insolvencies came from businesses with 501 or more employees with 0.16 per cent of larger businesses collapsing, compared to just 0.6 per cent during the same period a year before.
Rolf Hickmann, managing director of pH, an Experian company, said, “The fall in the number of insolvencies is a good sign and shows that businesses are distinctly aware of the current environment and are taking vital steps to protect themselves from risks.
“Apart from the very largest businesses, companies of all sizes saw marked improvements in insolvency rates. However, the greatest improvement came from the medium-sized businesses, which, as we have commented in previous months, have been the hardest hit by the recession.
The leisure and hotel industry and property sector were heavy casualties suffering 123 and 104 insolvencies respectively, however the building and construction sector continued to feel the most pain in May with 230 company collapses, while
The average financial strength score, which predicts the likelihood of a business failing in the next 12 months, of all UK businesses was up year-on-year, from 79.98 during May 2009 to 80.70 in May this year, but it was down slightly on the 80.76 recorded in April 2010. Although it was only a small decline, this was the third monthly decline in a row in average financial strength score of all UK businesses.
Hickmann added, “The small deterioration in the overall financial strength score for UK businesses during May highlights the need for businesses to ensure they continue to exercise caution with regards to their risk exposure and those they choose to deal with.”
Posted at 12:25PM Jun 25, 2010 by Marc Stenton in Insolvency | Comments[0]
UK Car Sales Rise Yet Again
More good news for the car industry as new car sales in the UK saw a 13.5% increase in May compared with May 2009.
According to the Society of Motor Manufacturers and Trader (SMMT), there were over 153,000 new car sales in this country, up from just under 135,000 during the same period last year. This made it 11 straight rises in sales as the industry regains its feet after a terrible period during the recession.
However, the coming months are going to be ‘extremely challenging,’ according to the SMMT, as it expects the full year sales to dip slightly after the end of the scrappage scheme.
The scheme, whereby buyers were offered a £2,000 discount for scrapping their car if it was more than 10 years old ran from May last year through to the end of March this year.
The SMMT now believes that the vast majority, if not all, orders made during the scrappage scheme have now been delivered after only 2.7% of deliveries taken last month were part of the scheme, way down on the 17% average that have been since the scheme began.
"It is essential that the upcoming emergency Budget promotes consumer and business confidence to maintain economic recovery," said Paul Everitt, SMMT chief executive.
Sales to private buyers were up 12.3% in May, while sales to the fleet market rose by 16%.
The Ford Focus has finally knocked its smaller rival, the Fiesta off top spot in the car sales list, the Fiesta had seen the highest sales figures in all four of the previous months. However, this month it fell to third, behind both the Focus and the new Vauxhall Astra.
Meanwhile, the sales of alternatively fuelled vehicles rose again last month by a staggering 195%, carrying its market share up to 1.1%, compared with just 0.4% this time last year.
Taking the year so far into consideration, sales figures are up by 22% compared with the opening 5 months of 2009, reflecting just how weak the 2009 car market was.
Posted at 03:28PM Jun 04, 2010 by Marc Stenton in The Economy | Comments[0]
HMRC Challenging Football Creditors Rule
The controversial Football Creditors Rule is being challenged in the high court by HMRC. The ruling, whereby creditors involved in football receive super preferential status in football insolvency proceedings, has come under heavy scrutiny since it was introduced, from HMRC in particular.
HMRC had previously informally challenged the ruling by refusing to agree to any football CVA proposal until the FA and Premier League reviewed the ruling. However now it seem they are looking to get rid of the rule in the courts once and for all.
"There is no legal basis for the football creditor rule," a spokesman for HMRC said. "Non-football creditors are being seriously short-changed and enough is enough."
The complaints surrounding the ruling are because it is essentially seen as unfair. All football debts are unsecured creditors in any normal case, meaning they are paid the same proportions of the debt as any other, however the super preferential status allows them to be one of the first paid and ensures they are paid in full.
The Premier League on the other hand has vowed to rigorously defend the rule, insisting that the football industry must protect its members by making sure all money owed stays in the game. However, some believe that this is in fact adding to the problematic debt culture in football.
For example, under current rules a player could transfer between clubs for a fee of £10m, paid in 4 yearly instalments of £2.5m. At present the receiving club will receive all of the monies no matter what happens, even if the buying club cannot afford it, because money will come in through insolvency proceedings.
This means that if the ruling is changed, under the same scenario, the selling club is more likely to demand some form of proof that these instalments will be met or they would reject the offer unsure if they would receive all the money, therefore meaning a change of the rule may see less cases of clubs spending money they haven’t got.
Furthermore, the rule also means that already rich footballers are ensured of getting all outstanding pay whereas poorer small businesses could end up writing off debt which would have a major impact on their business’ finances.
Posted at 04:34PM Jun 03, 2010 by Marc Stenton in Insolvency | Comments[0]
House Price Inflation Hits 8.5%
The latest figures from the Land Registry have shown that house prices throughout England and Wales are continuing to rise strongly.
The annual increase in house prices have now hit 8.5% after a further 0.2% rise in April, the fastest rise of its kind in over two and a half years since September 2007.
The number of mortgage deals being offered has also increased along with the house prices, with over 2,000 mortgage deals now on offer. This comes as lenders continue to relax their lending criteria.
At the start of this month, there were 2,191 mortgage deals available to buyers according to the financial information service Moneyfacts. These deals required deposits of between 0% and 40%.
The amount available at the beginning of June was a 14% rise on the start of May, however over half of these still require a 25% or more, making mortgages for first time buyers still difficult to come by.
"Lenders continue to ease their criteria and average rates still fall as competition for a limited amount of mortgage business gathers pace," said Darren Cook at Moneyfacts.
London has seen the highest price rises over the past year and the average house price in England and Wales now stands at £165,596.
London house prices have seen a rise of 14.8% in the twelve months leading up to the end of April, with them seeing a 1.6% rise in April alone. The average London home will now set a buyer back £341,487.
The Land Registry said, “While London's annual change mirrored that of England and Wales for quite some time, the capital's growth rate is now overtaking steadily."
House prices in England and Wales are gauged over 10 regions, all of which have seen a rise in house prices over the course of the year. Yorkshire and Humberside saw the smallest increase at 0.7%.
Meanwhile, sales figures are still relatively sluggish compared with the rise in prices.
HMRC have shown that last month there were 71,000 house sales completed in April, 2,000 less than March.
The sales of houses of the first four months of the year were substantially higher than the same period last year, with a 26% rise. However, they were still only half the reported levels in the three years previous to that.
Posted at 04:25PM Jun 02, 2010 by Marc Stenton in Mortgages & Housing Market | Comments[0]
Job Offers Up in UK
A new report has shown both good and bad news regarding unemployment in the UK. The good news is that the number of job vacancies across the nation rose slightly in May, however at the same time, the amount of money being offered fell.
The report said that 1% more jobs were offered last month compared to those in April, according to employment agency Reed.
The amount of money actually offered for these jobs sore a fairly steep fall of 4.2%. The average wage available for these jobs was £31,000 per annum, down from £33,200.
Reed have said that, in total, around 90,000 jobs were offered through their services last month, whilst the highest job demand rise was seen in charity and volunteer sectors. These were followed by marketing, public relations, legal and secretarial.
The managing director of reed.co.uk, Martin Warnes, said the increase in jobs available came despite concerns about the impact of government debt across Europe and the disruption of the general election.
"While it is good that the job demand trend is upwards again, recovery remains fragile," he said.
"In spite of [Chancellor] George Osborne's hopes, the private sector has yet to demonstrate it is taking up the slack in advance of public sector cuts.
"However, although employers are still suffering from cost constraints, some are seizing this opportunity to recruit talented people at high value to help grow their businesses."
Posted at 04:44PM Jun 01, 2010 by Marc Stenton in The Economy | Comments[0]
