Background

Salou Products Limited – trading as Bradcot Awnings – was a specialist manufacturer (outsourced to Eastern Europe) and wholesaler of caravan awnings. In recent years the industry had developed new technology to replace the traditional poles used in awnings with air-based systems, and the company had developed its own version, ‘modul-air.’ But despite adapting to the technological changes, manufacturing costs had continued to increase in Eastern Europe, and the company had struggled to compete with products manufactured more cheaply in China. The Director had been successful in cutting some business costs, but with sales deteriorating this was still not sufficient to enable the company to compete.

Action

FRP was appointed administrators of the business, and our Restructuring Advisory team was engaged to run an accelerated mergers and acquisitions (AMA) process to try to find the most suitable buyer for the business and its assets. The IP for the new technology was owned outside of the company, so the only viable purchaser was the existing Director through a newco. However, the Director was keen for us to explore the market in case a competitor put in a significant offer.

Outcome

As Joint Administrators, FRP successfully secured the sale of the business and its assets to Bradcot UK Limited. The completion of the sale ensured that the external secured lender was repaid in full, the company was able to continue trading from its existing site in Shipley, and all six jobs were transferred to the new business.