Receivers for CHS Electronics UK are in talks with a potential buyer and hope to have a sale finalised by Wednesday, the failed distributor revealed today.
After months of speculation about its future, following heavy losses and the revelation that the accounts of its US parent contained major discrepancies, CHS UK was placed in receivership by its major creditor DFS last Friday.
The move followed the announcement earlier that day that five of CHS' European subsidiaries would be handed back to their original owners in a bid to reduce debt by $146 million.
Receivers BDO Stoy Hayward hope to sell CHS UK as a going concern, citing a "substantial client base" as its major asset.
A statement released by CHS today revealed that DFS is owed a total of GBP 17 million: GBP 12 million from the UK business and GBP 5 million from CHS Germany. Amounts due to other creditors have not yet been disclosed.
While CHS had been in violation of the terms of its credit facility, DFS' action was "unexpected and unannounced", according to the statement.
CHS' parent hopes to refinance the debt with another lender, and remove CHS UK from administration, via its sale, and that of its Metrologie UK subsidiary.
Other jittery creditors, who are likely to include well known suppliers such as 3Com, Fujitsu, Computer Associates and Novell, have been assured that they will be paid.
"If there are any balances due to vendors from the UK subsidiaries after they have been sold, they will be honoured by the parent company. We will be communicating with each vendor today to inform them of the situation," the statement read.
Meanwhile, CHS UK continues to trade and no staff have lost their jobs, according to CHS marketing director Peter Rigby.
Thirty employees were made redundant, following the closure of CHS' DNS-Aptec division at Brentford last week, but Rigby said this was not linked to the receivership.
CHS had previously decided to lay off 50 staff as part of a program to relocate business activities to Slough, Rigby said.
Metrologie UK and Karma UK, another CHS owned business, continue to trade.
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