Administrators for different companies within the former M Price Group are disputing the real extent of inter-company loans owed to each other, with little information to go on.
In a new report, administrators from Seneca IP have revealed complications in settling the companies’ debts and repaying creditors.
The 143-year-old cladding specialist went into administration in August 2024 after struggling to pay back an emergency Covid loan. It was then hit by a £7.8m adjudication in a dispute with Barratt Homes.
The north London firm’s former main trading arm M Price Ltd (MPL) went into administration a year earlier – in August 2023. That administration is being jointly carried out by Begbies Traynor and Seneca IP.
Presently, around 130 trade creditors are battling to recoup £49.7m through the 2023 MPL administration.
From the claims submitted, one is for £6.7m and concerns remedial work related to former contracts carried out by the £29m-turnover facade firm. The job and creditor have not been named by administrators.
None of the unsecured creditors are expected to receive any money through the administration process.
In his latest report on M Price Group, John Hedger from Seneca IP said he was initially told that MPL owed the group £3.7m, but a counter claim has been made by MPL’s administrators for almost exactly the same amount.
He said former company directors had provided “almost no records” to investigate the claims.
“I have been unable to adequately investigate the remaining elements of the claim from MPL in order to robustly challenge or reject them,” he said.
Hedger, who is also a joint administrator for MPL, noted several times in the report that inadequate information had been made available to him in the administration process, including over property that the group owned.
“My work as administrator has been significantly hindered by a lack of company records, and a lack of response to specific queries raised with the directors. I continue to press the directors to provide specific information and all remaining company records,” he said.
He added that an aluminium crimping machine that had been stripped down into component parts worth just under £900,000 was alleged to have been transferred to the group from MPL in December 2021.
Hedger said he had not been provided with details of the transaction and was seeking information about any other possible transactions between the firms in the years before the administration.
In a liquidators’ report for sister company M Price Services, published last year, Hedger said that he was told “the business’ server was badly corrupted so all or most of the records were lost, other than the company’s payroll records which appear to have been received in their entirety”.
NatWest Bank is the only secured creditor of M Price Group and MPL and is owed a combined total of just under £1m across the two companies, with £750,000 relating to a Coronavirus Business Interruption Loan Scheme (CBILS) loan taken out in 2021.
Construction News revealed yesterday that just 37 per cent of CBILS loans issued to the industry during the pandemic have been paid back. Fewer than 12 per cent of bounce back loans issued to smaller companies have been recouped.
DRS Bond Management managing director Chris Davies said the “damning” figures highlighted a “forgotten debt burden” being carried by the industry.
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Ian Weinfass