Decanter World Wine AwardsOddbins goes into administration
- Thursday 31 March 2011
The final blow was actually struck at 4pm yesterday when HMRC (Her Majesty’s Revenue and Customs) said they would not be supporting the CVA (Company Voluntary Arrangement).
At a short meeting in London today to decide whether or not at CVA would be accepted by creditors, a representative of HMRC said they ‘could not support the proposal as they did not see it as viable.’
It is understood that there were protracted negotiations up to the very last minute between Oddbins and HMRC, which is owed over £8m by Oddbins.
As by far the biggest creditor of the stricken drinks chain, HMRC represented more than 30% of Oddbins debt.
Although 84% of creditors voted in favour of the CVA, once HMRC had voted, that figure dropped to 33%, meaning the CVA was voted down.
Simon Baile, managing director of Oddbins, said, ‘despite ongoing negotiations over the last four weeks the decision was made by HMRC late yesterday not to support the CVA.
He added ‘Oddbins is expected to go into administration’ following a hearing that will take place on Monday 4 April in the companies division of the High Court in London.
Creditors leaving the CVA hearing this morning were mostly grim and tight-lipped and offered no comment.
Nick James, managing director Pol Roger, which is owned over £200,000 said it was ‘sad it had gone this way’.
‘For a smaller company like us it is a hell of a blow. The implications of this will go right through the trade, from small growers to suppliers and distributors.’
Lee Manning, partner in Deloitte’s team handling the CVA said Oddbins would continue trading as normal, and the 400-odd staff would continue to be paid.
He said if appointed as administrator, Deloittes would hope to sell the business as a going concern. ‘We have already had two or three offers, both from the wine trade and from elsewhere.’
He added that it was unlikely the payment to creditors would exceed £0.075 (7.5p) in the pound.
Baile added, ‘We very much regret the need to make so many staff redundant prior to last night’s vote and we are working diligently to find a buyer for the majority of the business so that as many jobs as possible may be saved.’
Have your say!
Hester
April 06 13:53
Oddbins had too many loss making stores it would appear. If theyd been culled earlier then they would continue. More fool Baile et al for not getting rid of stores sooner. Thats what will probably happen now and youll probably see the new owners as saviours...
oddflo
April 05 23:02
I agree with the idea that Oddbins concept still has a big potential.
I think that in order for Oddbins to survive, first of all it needs to cut down on much of its scruffiness and lack of organization. The feeling from within is that some head office departments don't work as hard as the staff on the shop floor.
I also wonder whether the rescue plan would have been successful had it been proposed at an earlier stage. The signs of an oncoming catastrophe have been evident for many months.
Having said that, Oddbins is truly unique as a wine retailer and as a workplace and I really hope that it will survive this storm.
James Pala
April 04 02:25
Does anyone know what they are selling the business for?
d rickard
April 03 23:09
i agree as above,im a mgr for the company,ive had 4 yrs of growth,why you may ask,answer the one to one with the customer you dont see that in a supermkt,i shop in them wkly,and look at there offers in there wine departments,only to see no staff to offer advice,its the personal assistance from food matching to asking the question would you like that wine gifted wrapped free,lets hope my job is safe,ive had 4 yrs of growth,supermkts open around me,but yet they the customers keep coming back,why for that personal service,mt customers
are loyal that loyal they know me by my 1st name,do you know your supermkt mgr by his 1st name i dont,fingers crossed you will still see me in my store,long live the wine specialist