Bridgewater Paper Company’s latest debt estimate of more than £300m is thought to be “significantly understated” by its administrator.
A spokesperson for Ernst & Young said: “The official figure is actually unknown. But we believe [the £300m estimate] to be significantly understated.”
Its Notice of result of meeting of creditors, published last week, shows Bridgewater’s director Robert Clarke believed the company’s liabilities as of mid-February totalled £302,550,930. Its assets add up to just over £20m.
Two weeks ago, the administrator told MRW it estimated that Bridgewater owed £150m-£200m – half the amount its director has now estimated - when it was revealed that “onerous” energy costs were the primary reason for the firm’s downfall (see MRW story). Ernst & Young now believe the estimated £300m of debt will escalate.
A more detailed summary of assets and liabilities now released shows creditor deficiencies make up the largest proportion of the company’s liabilities, amounting to £276m. Debts owed to non-preferential creditors total £78m.
The report follows a meeting of creditors on 25 March at Ellesmere Port Civic Hall.
According to the document, Ernst & Young’s staff fees amount to £648,591. Its average hourly rate charged is £329. Creditors agreed that Ernst & Young continue to manage the affairs, business and property of the company including: continuing to conclude sales of property and other assets; evaluate and consider any further sale of the business; continue to realise stock on hand; and finalise the administration and payment of administration liabilities, among other requirements.