Landlords, suppliers, customers and employees owed £821.1m following the collapse of Focus DIY have received nothing.
The collapsed retailer’s secured creditors have been paid in full but the £600,000 available to unsecured creditors has been deemed too costly to pay out.
A progress report from administrator Ernst & Young shows Focus DIY’s Closing Down Sale after it went into adminsitration in May made £100.6m for its lenders.
The administrator’s fees for handling the administration come to £4.6m, plus expenses of £72,000.
Former Focus owner Cerberus Capital FLP3 has received just £25m of the £214.7m owed as it is ranked as a second secured lender.
Secured lenders GMAC and Bank of Scotland have been repaid the £32.2m they are owed following the Crewe-based home improvement chain’s collapse in May, as first revealed by Retail-Week.com
Just £600,000 could be made available to the 15,000 non-preferential creditors – including 10,000 customers owed a collective £3m – meaning they would receive “significantly” less than 1p for every £1 owed. Ernst & Young said the cost of paying out this money would be “disproportionate to the benefits”.
Focus suppliers are owed £61.4m, its employees are owed £15.6m and intra-group creditors to Focus and its Do It All brand are owed £415m.
Joint administrators Simon Allport and Tom Jack said: “Despite difficult market conditions in the retail sector we successfully traded the business, for 11 weeks achieving sales in excess of £100m, realising an excellent return for stock held at appointment.
“Importantly, we were pleased to achieve the sale of option agreements for 58 stores, resulting in the transfer of 1,200 jobs and further realisations of around £46m.”
- The Focus DIY brand could be resurrected after MFI owner Walker Group bought it for a reported £300,000 at the start of this month.