Oddbins supporters rally as debts of £20m published
- Monday 21 March 2011
While Oddbins' debts are considerable, with many hundreds of creditors owed sums totalling over £20m, one insolvency expert said they are not unusual for a company of this size.
By far the largest creditor is HM Revenue and Customs, which is owed over £8m. A major part of this bill will be the Oddbins’ large liability for excise duty each year.
The list of creditors, published by consultants Deloitte, is a roll-call of the world’s major wine businesses. UK importers Hatch Mansfield are owed £309,734, Mentzendorff £161,567, JF Hillebrand £24,470, Caves de Pyrene over £7000.
Champagne house Pol Roger is owed £134,000, Negociants UK over £90,000, Diageo over £84,000.
Overseas producers pepper the list: De Bortoli £106,000, d’Arenberg £29,000, Gonzalez Byass £19,000, Gemtree £47,000.
Outside wine, Halfords is owed £173,000, and the London Borough of Kensington and Chelsea £22,000.
Keith Steven of insolvency practitioners KSA told Decanter.com he was not ‘overly surprised’ by the scale of the debts, and that he though HMRC would ‘probably’ support the Company Voluntary Arrangement (CVA).
Creditors vote on 31 March on whether to approve the CVA, that will see them being paid around £0.20 in the pound. Should Oddbins go into administration, those owed money would see much less than that.
Creditors spoken to by Decanter.com are broadly sympathetic. ‘We will support Oddbins in their CVA,’ Patrick McGrath of Hatch Mansfield, one of Oddbins’ biggest creditors said. ‘I very much hope they will succeed.’
Mike Awin of ABS Wine Agencies, owed over £16,000, also gave Oddbins his unequivocal support.
Another creditor assured Oddbins of his support but made clear he did not see the business as viable in its present form.
‘They’ve reduced the number of shops, which is good, but they have to change the strategy. You can’t run a modern wine retail business full of wines that no one has heard of.’
Andrew Hawes, managing director of Mentzendorff, said he would support the CVA, adding, 'but it's not a magic wand. I'm looking forward to hearing Oddbins' strategy on how to develop within a changing marketplace.'
Importer Caves de Pyrene, meanwhile, explained it was the growers who were taking the hit, as Oddbins owed them the money directly.
'It's up to them to decide if they want to take the risk of selling to Oddbins in the future.'