Unsecured creditors of Paperlinx UK still do not know if they will receive a meaningful pay-out or not, six months on from the administration of its operations.
Paperlinx UK and its various trading and non-trading entities were placed into administration with Deloitte on 1 April. The hugely complex web of related intercompany transactions has contributed to the length of time required to deal with the administration.
In its progress report to creditors for the period to 30 September, Deloitte stated: “Unsecured creditors of the Trading Companies are likely to be paid a dividend, although the quantum remains uncertain.
“For the remaining companies in administration the distribution is dependent on the flow of funds from the Trading Companies arising from the intercompany claims.”
Secured creditors, including ING and RBS Invoice Finance have been paid in full. ING was owed £41m, and RBS £21.8m.
The administrators have also dealt with 158 retention of title claims totalling £23.2m, which have now been resolved. Deloitte brought in £191,717 in pallet collection fees as part of this process.
According to the latest report, the unsecured claims – including more than £180m relating to Paperlinx UK pension schemes – across 18 separate Paperlinx entities come to at least £305m.
The Pension Protection Fund sits on the creditors' committees for what had been Paperlinx's three main trading entities: Robert Horne Group, The Paper Company, and Howard Smith Paper Group.
Deloitte also stated that the claims were still to be finalised. “In particular, intercompany claims have yet to be fully reconciled and filed, we await a revised claim from HMRC and there is some uncertainty around potential joint and several liability for the pension deficits. The impact of these will materially impact overall claims, and hence distributions, in certain entities," it said.
All the former Paperlinx sites have now been vacated, with the once-flagship Northampton warehouse and office the last to be relinquished, on 23 October.
Deloitte appointed Moreton Smith Receivables last month to pursue the remaining outstanding debtors of the companies.
Deloitte’s time costs total £5.3m during the period from 1 April to 30 September, and it has drawn fees of £1.85m.