FRP team successfully secure the future of an Orkney shellfish processing business
FRP’s Restructuring Advisory team achieve sale of Orkney shellfish processing business saving all jobs and enabling continuation of trade

Background
Based in Stromness on the Orkney Islands, Orkney Fishermen’s Society Limited was incorporated in 1953, processing and supplying shellfish to the UK mainland and direct to the end consumer. The company held BRC accreditation, with the shellfish processed on site, particularly crab, and sold to a number of UK supermarkets, in particular M&S and Tesco, which accounted for the majority of sales. The company was formed as a co-operative society, registered under the Co-operative and Community Benefit Societies Act 2014, to provide the members (i.e. fishermen) with a guaranteed market for the shellfish caught, allow the purchase of chandlery and bait at discounted prices, and obtain a return from the shares held.
The company encountered a number of issues in recent years which significantly impacted its operational and financial position, including the adverse weather in 2018 leading to a significant shortage of crab, the Covid-19 pandemic and Brexit, resulting in acute staffing issues. These issues led to increasing cash flow pressure, which resulted in a back log of aged creditor balances, including significant sums owed to local fishermen and fish merchants.
Action
FRP were initially engaged by the company to complete a review of the short-term cash position and the options available to the company, together with the outcome for key stakeholders in the event of an insolvency. Following our options review, it became clear that an Administration appointment was likely and in order to protect the value of underlying business, to preserve jobs and to minimise creditor claims, an accelerated sale process should be explored to assess the interest in the business. FRP was engaged to assist the company’s committee members / directors in marketing the business and assets for sale and assisting in negotiations with potential interested parties with a view to securing a sale immediately following the company being placed into Administration. FRP also engaged with key stakeholders of the business including Orkney Council and Highland & Island Enterprise throughout the sales process.
Outcome
The team successfully secured a sale for the business, as a going concern, along with certain assets, including the freehold properties, tangible assets and IP to a supplier of the business. The sale allowed the continued trading of the business, secured ongoing employment for all of the company staff and generated a significant uplift in asset value compared to a break-up scenario.
The sale allowed the continued trading of the business, secured ongoing employment for all of the company staff and generated a significant uplift in asset value compared to a break-up scenario.Michelle Elliot Restructuring Advisory
Related team

Michelle Elliot

James Dempster
