Unsecured creditors of collapsed value retailer Bonmarché may not recover much of the money they are owed.
FRP Advisory, which was appointed to handle the administration in October, said there is no guarantee that there will be enough money to pay back the £23.9m owed to this group of creditors, which includes suppliers.
In an administrators report published in December, FRP said: ”Based on the assumptions made in the estimated outcome statement it is currently estimated that there may be sufficient funds available to make a distribution to unsecured creditors in due course.
“This distribution will be paid by a subsequently appointed liquidator, the costs of the liquidation cannot at this stage be estimated and therefore it is not possible to estimate the level of distribution that may be made.”
Edinburgh Woollen Mill Group (EWM) owner Philip Day’s investment vehicle Spectre bought a majority share of the retailer in April, triggering a mandatory takeover bid. However, it fell into administration after a “sustained period of challenging trading conditions and cashflow pressure”.
EWM fascia Peacocks is currently the preferred bidder for Bonmarché. Day provided a loan and credit facilities to Bonmarché prior to its collapse, which any buyer would have to repay.
The business traded from 316 stores and employed 2,919 at the time of appointing administrators.