ICSM credit’s view on cynical directors who wish to dump debt

Concerns mount over phoenix operations after trade publication raises question over collapsed firm

Print Week have charted the demise of Symposium Print based in South Wales while at the same time have in effect also raised the issue of phoenix operations.

Phoenix firms being ones that rise from the ashes of the collapsed company. Ian Carrotte of ICSM Credit has a seasoned view of the phenomena. He said: “We have seen several cases where company directors appear to have pre-planned a phoenix by preparing ahead of a potential company collapse. They register a new company name and switch the assets where possible from the existing company in trouble to the newly listed one.”

Writing in Print Week Hannah Jordan and Rhys Handley have reported on Symposium Print and Andrew Studley who is the sole director of Promising Print registered last October. They reported: “Stewart Bennett of ST Bennett & Co was appointed liquidator of the company on 20 February, following a meeting of creditors on the same day. A winding-up petition had been filed against the printer by solicitors Irwin Mitchell on 27 January 2020 at Birmingham District Registry, on behalf of petitioner Andrew Lewis, and a hearing had been set for 24 March. Symposium Print was established on 5 March 2018 under the directorship of Andrew Studley and 12 months later the company bought the assets of Symposium Design & Print, of which Studley is also the sole registered director, when it fell into administration after nine years of trading.

“According to Studley, Symposium Print stopped trading a year ago and he has now chosen to liquidate the company because he ‘did not need it anymore’. He declined to comment further. A notice for compulsory strike-off of Symposium Print Ltd was posted in May 2019 and then action was suspended in June.”

In the popular comments section of Print Week one contributor makes the point that as long as paper merchants, press manufacturers and other firms continue to supply a company that they think may be a phoenix then the process will continue.

Ian Carrotte said the victims were always the staff who often don’t get paid and have to claim statutory redundancy pay and the suppliers whose invoices are left unpaid.

He said: “Cynics will point to the fact it is often the same people who are behind one collapsed firm are the same ones involved in the new. It’s not a new phenomena, but in ICSM Credit we always warn members of a potential phoenix and not to give credit under any circumstances as the chances are they won’t get paid.”

Last November Print Week reported on the collapse of Cannock-based KJB and Creative Digital Printing Solutions which relates to the current story. They reported: “It is understood that KJB and Creative have continued to trade through the administration period and according to a source close to the business have been acquired out of administration by a new firm called Promising Print. According to Companies House the business was incorporated on 8 November 2019 under the sole directorship of Andrew Studley, and is trading under the names KJB Lytho and CDP Digital. Studley is also the registered director of Prints-It Ltd, incorporated on 15 July 2019, and Symposium Print, incorporated on 5 March 2018 at the same address. A former company, Symposium Design & Print, was registered under Studley's name in January 2010 but fell into administration in March this year and was dissolved in September. It's assets were acquired by Symposium Print.”

The Insolvency Service points out that ‘phoenixing’ is not illegal unless there is misconduct by the directors. This includes: causing significant harm to customers, suppliers, etc; misusing a company’s assets (eg using or taking company assets for personal benefit); breaking the law (eg fraud or not complying with regulations); trading while insolvent when there is no hope of the company recovering.

ICSM Credit

For details about ICSM Credit call 0844 854 1850 or visit the website www.icsmcredit.com or email Ian at Ian.carrotte@icsmcredit.com on how to subscribe and to join the UK’s credit intelligence network to avoid bad debts and late payers. Follow ICSM Credit on FaceBook, Twitter and YouTube and Ian Carrotte on LinkedIn.

To keep up to date subscribe to the FREE ICSM Credit Newsletter to hear all the latest insolvency news and to see who has gone out of business click on the orange panel on the top left of the home page of the website www.icsmcredit.com or send an email to Ian.carrotte@icsmcredit.com

For details for the work of the journalist Harry Mottram visit www.harrymottram.co.uk

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