Esken: Former Eddie Stobart owner to enter administration
Esken, the former owner of Eddie Stobart, has announced it will enter administration later today.
The company, which is registered in Guernsey and based in London, has said it is making the move to “protect the interest of stakeholders”.
Earlier this month, a deal was announced for Esken-owned London Southend Airport to be taken over by US private equity giant Carlyle.
In a statement issued to the London Stock Exchange, Esken said that the implementation of a proposed restructuring plan has “ceased to be commercially viable”.
Esken said its directors have resolved to file documents in court today to appoint administrators from AlixPartners UK LLP to the company.
It added that the application is expected to be approved by the court over the course of the day.
The trading of Esken’s shares has been suspended with immediate effect.
Ahead of suspension, the firm’s shares were trading at 0.07p, giving it a market capitalisation of £820,000.
In a statement, the company said: “Esken, the aviation group, announces that, further to the announcement on 6 March, the company has concluded (following detailed advice from advisers) that implementation of the proposed restructuring plan in relation to the company has ceased to be commercially viable.
“While restructuring plans are becoming more common for English registered companies, additional issues arise under Guernsey law in relation to Guernsey registered companies (such as Esken) where the plan results in compromising the rights of members (as is the case for the proposed plan in relation to the company).
“Esken has therefore concluded that there is unacceptable risk associated with the court process to achieve the proposed outcome, which could also take considerable time to execute.
“Therefore, after detailed consideration of the company’s current financial situation, and absent any further viable proposals to deliver a stable solution to the challenges faced by the company, the board has now regrettably concluded that the company should be placed into administration in order to protect the interests of stakeholders.”
Esken added that placing the company into administration “does not breach” the Recapitalisation Support Agreement announced on March 6 and “therefore is not expected to have any impact on the recapitalisation proposal being implemented in relation to London Southend Airport, which will continue to remain fully operational and funded under that proposal”.