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Entu To Be Placed Into Administration

Entu To Be Placed Into Administration

At the end of last week we got a further update on trouble home improvement group Entu. Here was update number one, posted on the Entu Media Centre part of the website:

On 24 August 2017, the Company’s ordinary shares were suspended from trading pending clarification of its financial position.

Today, 25 August 2017, the Board has concluded that the holding company of the Group, Entu (UK) plc, is no longer able to continue trading as a going concern whilst pursuing a sale of the business and has filed notice of intention to appoint administrators to the Company.

Unless financial circumstances change, and in accordance with statutory requirements, the Board intend to appoint administrators within 10 business days. The secured creditor can, however, appoint administrators without the requirement for notice.

The Company will make further announcements in due course.

And here’s the second update, published a few hours later:

Further to the announcement of the intention to appoint administrators to Entu (UK) plc earlier today, the Company has been advised that Zeus Capital intends to resign as Nominated Adviser and Broker to the Company on the appointment of administrators.

No real surprises here. After the suspension of trading of shares in the company, this was the next expected step. It appears that whatever leads to sell the business have not proved fruitful.

What happens next

As KPMG have already been tasked to rescue the company, barring anything wildly unexpected, KPMG will take the reins as administrators. Their next task will be to identify every single possible way to keep the company trading, in whatever guise possible.

Entu’s administrators will have 8 weeks to save the business. In that 8 weeks, the administrators will contact Entu’s creditors with a proposed plan on the repaying of debts. This plan will also give an indication as to the outcome of the process. This is where you can get some honesty. Entu’s administrators will already have a fair idea as to what they can expect to be able to repay to creditors. They will know the health of the company, they will know what monies will be coming in, if any, in which they will be able to use them to pay their debts.

During these 8 weeks, the administrators will continue to look for a purchase of the company. In this case however, given the fact that the company approached a number of buyers already, and it appears that not a single one of those leads have proved useful as of yet, the chances of finding a buyer during administration are slim.

They may decide to spin off certain parts of the company. There are some quite well known names within the Entu group, such as Zenith and Weatherseal. Could they be snapped up by other installers and merged into them? Given the health of national retail installation, that seems unlikely. I am not privy to any sort of accurate detail. But as an outsider, there doesn’t appear to be any sort of road out of this.

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It’s about people

Whilst the industry ponders as to the fate of Entu and it’s companies, we must remember that there are a lot of people that are due to lose out pretty soon.

Some, who have been trying to keep up with the pace of the movements, may already be looking for new jobs or have already found a new employer. Some will be hoping for a turnaround at the company. Unlikely at this juncture.

There are a lot of people that work at this group of companies, and there probably isn’t a worse time, in the lead up to the end of the year, to have to start worrying about their jobs. In 8 weeks time, if a buyer cannot be found and debts to creditors and wages cannot be paid, there will be a lot of people at the Entu group who will start to worry very quickly.

There will be quite some anger towards those at the top of the company. As you would expect, they will be held responsible for the fate of the company and anyone that loses their jobs will feel as though it’s on them. During the administration, scrutiny will be placed on the running of the business, and questions will be asked as to whether something could have been done to turn around the fate of the business. If you have read my previous posts on this story, you will know my thoughts on this already.

I am keeping an eye on this story as it develops and will publish further updates as they happen.

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By | 2017-08-29T21:15:02+00:00 August 29th, 2017|Categories: business|

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