You may have remembered back in April that Paperlinx UK had declined and went into administration. Well today it has been revealed that Paperlinx UK owed trade creditors a massive $106 million. As well as this they also owe more than 360 million to its pension fund.
Reports to creditors that were obtained by Print Week have shown that the catastrophic deficits that have been mostly aimed at the paper manufacturers have been bleeding roughly $1 million a week.
The company had a net loss of $40 million at the end of February 2015. Chief executive Andy Pearce said here were several reasons for the UK operation’s collapse, but administrators at Deloitte say the trigger was the breach of covenant on an $80m loan from ING.
They owe the most to a European manufacturer Stora Enso that is roughly estimated at £10.5 million. Artic Paper are owed £2.9 million and Lecta Paper are owed just over £6 million. However there have been roughly 4000 pallets of stick acquired from Paperlinx’s warehouses which may potentially decrease these figures.
But it doesn’t end here, Paperlinx also owe more than £10 million in taxes it has not been made clear however that they will get anything back, with administrators saying that returns are likely but will be modest.
Administrators of Paperlinx have tried to sell the company but have been unsuccessful because of the huge concern of their loses and their other debts. It did manage to sell some pieces for $14m, including $3m from Paperlinx’s failed VTS business, and $11m for and its three packaging businesses, which were not in administration.
Administrators are currently hoping that Paperlinx Benelux creditors ING and RBS invoice finance owed $43 million will be paid in full .