We have recently been reflecting on our own success having helped one of the UK’s leading manufacturers of automatic train-washing-machines.
With a heritage stretch back to the Victorian era, Washer* has been a global success story, exporting its products as far afield as Africa and Asia.
However, last year it ran into issues with its pension scheme. In common with many old companies, Washer’s financial viability had been hampered by a large final salary pension scheme deficit.
This led to other financial issues within the business to a point where the future of the firm was uncertain.
It was at this point that we were called on to step in and assist with the multi-million pound company’s recovery.
Going against the advice of some more cautious peers, Lynn Gibson, our Managing Director decided to resolve the company’s issues via a Company Voluntary Administration (CVA).
The CVA permitted Lynn to move the pension scheme in to the Pension Protection Fund, install a turnaround specialist in place of the Managing Director and renegotiate client contracts and the business’s factory lease arrangements to better reflect the business’s situation.
“It was clear when I came in that the business, despite being profitable in the past, was in serious financial trouble and was teetering on the edge of complete insolvency,” said Lynn.
“This would have resulted in the loss of a historic firm, which would have been devastating. By conducting a CVA we allowed the firm to improve its position, while remaining protected from additional costs.”
Following the CVA the company is now once again profitable and only five redundancies occurred, saving 38 jobs that would have been lost, added Lynn.
She said: “This is a good example of how seeking the proper advice can pay dividends for a business that is struggling. It is never too late to act and I would encourage businesses in a similar situation to get in contact with us.”
*Company name anonymised