A private taxi carrier business was experiencing difficulties due to pressure from several overheads. We were instructed to help with negotiations with creditors and later appointed to place the business in to administration.
The client & the situation
A private taxi carrier business with a range of clients
The current owners of the business had purchased the share capital of the business in 2021 with the objective of turning the business around. The business had recently generated significant turnover but had historically been loss making for several years and was heavily dependent on funding from its parent.
The new business owners immediately undertook several cost cutting measures which resulted in the redundancies of several staff and also withdrew from the vehicle rental side of the business. However, there were several overheads including a lease that were not required and the company was not a viable proposition with these ongoing.
What we did
We were initially instructed to assist the company in their negotiations with key creditors, offering terms to compromise these debts on commercial grounds. Discussions were ongoing but ultimately an agreement could not be reached. The company then instructed us to assist them in continuing negotiations with creditors and at the same time, prepare and plan to assist with placing the company into administration.
We instructed agents to prepare a valuation of the company’s assets and continued in our efforts to seek agreement from creditors, presenting them with the outlook and likely return if the company was placed into administration.
The outcome
We were able to agree settlement terms with their key creditors and avoid the company entering a formal insolvency procedure. This resulted in the best return for creditors and allowed the business to trade on.
