Mon, 23 Feb 2015 | ADMINISTRATION
It is believed that an unsecured shortfall of £14 million is still owed to trade creditors and HMRC after Eco Plastics fell into administration.
Bottle recycling firm Eco Plastics fell into administration in December 2014 with David Riley and Joseph McLean of Grant Thornton appointed as joint administrators. A rescue deal from Aurelius was completed after a preferred solvent sale fell through.
However, it has been revealed that the administrators only expect £600,000 of the £15 million owed to unsecured creditors to be paid, resulting in a £14.4 million shortfall. Former suppliers are owed £10.8 million, while HMRC is due around £1.9 million.
Plastics Eco Ltd, a subsidiary of Aurelius, was set up as part of a rescue deal worth £3.56 million. It subsequently changed its name to Eco Plastics Recycling Ltd.
The initial preferred option of a solvent sale had previously fallen through. Riley and McLean had approached 27 potential buyers in the seeking of an “accelerated sale”. After two offers were submitted, the board accepted one on a solvent basis. But primary shareholders Ludgate Environmental Fund could not agree on the solvent sale and the offer from Aurelius was accepted after it was deemed the “best outcome” for the company.
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