Online bathroom giant Victoria Plum went into administration last week owing millions to suppliers, customers and installers with ‘no prospect’ of any being paid back.
Administrator Ernst & Young has revealed that the company’s new owner, AHK Designs, paid £7.8m in a pre-pack deal for stock, brand, IP, plant and machinery with all 345 employees remaining.
However, the sale leaves behind debts of £24.3m with, Ernst & Young says, “no prospect of any funds becoming available to unsecured creditors”.
Shockingly, Victoria Plum customers are owed £2.25m with just under £222,000 in unpaid refunds, £665,000 in unfulfilled trade orders and £1.36m in unfulfilled design and installation orders.
And 72 separate installation companies are owed a total of £483,000.
Some of the biggest brands in bathrooms have also been stung for tens of thousands or in some cases hundreds of thousands of pounds. Some of the biggest individual creditors are Chinese suppliers who, in total, are owed over £1.8m.
The single biggest unsecured creditor is Google – owed over £3.6m.
The administrator says that after Victoria Plum was acquired by private equity firm Endless in 2019 it traded well through the pandemic and revenue increased to around £113m in 2022 from £99m in 2021.
Endless then tried to sell it in late 2021 but no real offers materialised and, in 2022, the company started to experience “challenging trading conditions” due to, Ernst & Young says, a drop in market demand and an increase in freight costs. This led to a £1.9m loss in the year to February 2023.
In January, the sales process was opened again as trading conditions hadn’t improved and a “system error” had seriously impacted the company’s marketing strategy and led to a “material reduction in revenues” during April and May.
AHK Designs – whose affiliate, Giomani Designs, owns other online retailers Beds.co.uk and Cox & Cox – has confirmed that the acquisition includes Victoria Plum’s head office and nationwide distribution network. It says the business will benefit from being part of a larger group which owns complementary businesses.
Aamir Khurshid from AHK Designs said: “Victoria Plum is a leading online retailer of bathroom products with a strong brand and market-leading product. We are pleased to be investing in the future of the business and look forward to welcoming all of Victoria Plum’s employees into AHK Designs.”