Associated lighting companies, Luxx Light Technology (UK) Limited and Ledtec UK Limited, based outside Cambridge were unable to maintain the terms of their respective Company Voluntary Arrangements (“CVA”).
Having each entered into a CVA in April 2018, both businesses looked to make contributions over a 36 month period.
The Director – of each entity – sought advice in November 2018 after a poor trading period meant that neither company could continue to meet the obligations of each CVA. The Directors subsequently took the decision to place both companies into Administration, to enable a rescue to take place.
Following their appointment, the Joint Administrators marketed the business and assets of each business for sale. Having undertaken one redundancy, necessary for economical, technical and organisational purposes, a successful offer was received from a company called LED Luxx UK Limited.
“It was pleasing that the majority of employees jobs were saved in this instance”, said Simon Plant, one of the Joint Administrators. He continued, “we have seen again that companies have entered into CVA’s yet not been able to complete them. Statistically, most CVA’s do fail and so it is vital that directors give serious consideration to their appropriateness”.