Creditors of collapsed fitout specialist Beck Interiors have had their hopes of recuperating their losses dashed, as administrators struggle to salvage sufficient sums from the company’s accounts and assets.
Insolvency specialist Begbies Traynor said there will be ‘insufficient’ funds available to satisfy claims against the former Surrey-headquartered business, which now total more than £113.2 million from unsecured creditors.
Beck, founded more than 30 years ago, filed for administration in July last year, following “liquidity issues” relating to an ongoing customer dispute, supply chain failures, and increased costs on existing contracts.
At the time of its collapse, Beck was owed more than £15.8 million in outstanding contract debts and retentions for several projects.
Its portfolio focused on luxury hospitality, leisure, residential, and museum projects throughout the UK and overseas, including the refurbishment of The Dorchester Hotel, on Park Lane, in London.
However, as many subsequently became the subject of disputes and counterclaims, it is unlikely any significant sums will be recovered from their administration.
“Based on the information currently available, there will not be sufficient funds available to enable a distribution to be paid to the unsecured creditors of the company in this instance,” said Begbies Traynor.
One such case, which is still ongoing, is between Beck and Eros Limited, a major debtor of the company, with the latter disputing a £6 million debt owed to Beck and lodging a £35.9 million counterclaim for alleged “defects” in works undertaken by Beck.
Eros has since challenged a finding in favour of Beck, to pursue its original claim, bringing in insurer HCC International, who provided the performance bond relating to the contract.
Global multinational law practice Eversheds Sutherland is assisting the administrators in various legal matters, with specialist quantity surveyors Pythagoras assessing Beck’s accounts.
An administrators’ progress report, covering the period between January and July this year, also found HMRC is seeking to claim £6.9 million from Beck, Barclays Bank more than £2.7 million, and former employees of the firm around £151,000.
The outcome of all remains “uncertain”, administrators said.
The administration filing in July last year followed a winding up petition filed against Beck the month prior, by Mitsubishi Electric Europe (MEE).
Eltrade Electrical Limited, Sidney Cubbage (Heating and Ventilating Limited), F J Corvan Limited, and MES Contractors Limited, were also listed as supporting creditors, under the winding up petition at the time.
Winding up petitions are serious legal actions and can lead to a company’s bank accounts being frozen.
An unpaid creditor can petition the courts to force an insolvent company into compulsory liquidation.
Beck began trading as an Employee Ownership Trust in 2021. Accounts for the year ended 31 December 2022 appear to show turnover of £139.3 million, generating a pre-tax profit of £7.2 million and operating profit of £7 million, all significantly up on the previous financial year.
It is understood Beck Interiors employed in the region of 150-250 people.
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