Administrators Allan Graham and Matt Ingram of Duff & Phelps were appointed on Friday (18 January) and the deal was concluded the same afternoon.
Paragon has bought the Service Graphics name, and the trade and assets of the Skelmersdale and Glasgow sites, with 124 employees transferring under TUPE rules as a result.
In a statement, Graham said: “Our goal was to sell part or all of the business as a going concern. While it is regrettable that we could not sell the business in its entirety, we have secured the future of two of the SG sites.”
Paragon Group integration director Angus Campbell said: “Service Graphics is a very strong name and brand. The businesses acquired are very good at what they do with good management teams and a great client list.”
Campbell said that finalising the details of the deal had proved challenging. “It’s been a very difficult process due to the number of changes that have taken place in the business and the lack of quality information [from inside the company]."
Skelmersdale produces graphics such as theatre backdrops and building wraps under the trademarked Scanachrome brand. Glasgow specialises in large-format graphics for a variety of markets and serves clients in the north.
The two Service Graphics sites will sit under the Paragon Graphic Services business. Paragon has now established a substantial presence in large-format printing, having also acquired Magenta Print & Display from Debenhams just six weeks ago.
PrintWeek understands that the 156 employees at its head office in Chessington were notified of the site’s closure yesterday. Service Graphics also had a small sales office in Nottingham with five employees.
However, the joint administrators said they remained open to offers and urged interested parties to “act promptly”.
A source close to the situation said that employees at Chessington were in shock.
“There are some very loyal people there who can’t believe this has happened,” the source said. “They are deflated because no-one is interested in Chessington because it’s too big and has too many issues.”
He said he was angry about the outcome: “Fee-taking people took over with no experience of our industry. It feels like it’s all a game to them.”
Duff & Phelps instigated a fast-track sale of Service Graphics last week.
The business was understood to be facing cashflow issues. Yet just last month the firm’s new managing director Alex Penner spoke of fresh investment being underway at the company, with plans in place to “realise its full potential”.
In March 2018 Service Graphics was acquired from St Ives alongside SP Group by Landry Kouakou’s investment vehicle SelmerBridge. He put SP Group into administration four months later, leaving creditors owed millions of pounds.
Kouakou’s financial partners are Irish firm Sitara Finance and “alternative credit” specialist Secured Corporate Finance, based in London.
Kouakou has not commented on events at Service Graphics.
In its most recent accounts, for the year to 31 July 2017, Service Graphics had sales of £40.5m and made an operating profit of £963,000.