Unifresh Foodservices, the Kent-based fruit supplier run by Hannes Martin, has gone into administration with debts of over £400,000, FPJ has learnt.
Martin, who previously ran MVS Food Services, is continuing to trade under the new name Unifresh Holdings Ltd having purchased the Unifresh assets for £40,000 from administrator Savants late last year. The arrangement, which is entirely legal, allows him to start a new business without the burden of his previous debts.
According to administrator Adrian Duncan, Unifresh was growing steadily, making profits of £158,000 in 2012 and widening its customer base.
However, between June and August last year the company incurred four extraordinary losses totalling £225,000 due to “the actions of trade suppliers and third-party service providers,” Duncan said. This led to unsustainable cash flow difficulties.
Martin attempted to keep the company afloat by reducing overheads through a reduction in staff and relocation of the business to Paddock Wood, but administrators were appointed on 31 October 2013.
Martin told FPJ this week that the downturn in fortunes came after he was allegedly defrauded by a South American fruit exporter. He explained that he then paid up front for a Middle Eastern fruit shipment that was later rejected and the money apparently not returned. He also expressed regret if former creditors were left out of pocket.
Savants initially believed the company had potential to be sold as a going concern due to its trading history, staff knowledge and specialist nature of the business, however it was decided that a pre-pack administration and a sale of the goodwill to Martin was the best course of action.
The option of trading while in administration was considered but discounted due to the risk of losing key staff members, Duncan said. “It was [therefore] concluded that a pre-pack administration was the best possible option for protecting the goodwill of the company… [and] is considered to deliver a better outcome for the company’s creditors than would otherwise be achieved in a liquidation.”
He added: “It is not considered possible to rescue the company, because there is insufficient value in the company’s balance sheet to facilitate a feasible plan to restructure the company’s debts while continuing to operate the business.”
As of last October, secured creditor Bibby was owed £251,000, with unsecured creditors owed a total of £228,406. Although Unifresh invested heavily in new machinery and premises in the last six months, much of the equipment was subject to hire purchase or lease finance agreements. Despite that, Martin insisted Bibby had now been repaid, along with around £60,000 of the debt to unsecured creditors.
Unifresh was set up with the aim of supplying fresh fruit to the UK catering, processing and juicing sectors, with a particular focus on grapes, apples and citrus. The new business is understood to be operating along similar lines.