In a ‘statement of affairs’ published on Thursday (16 November), the administrators, Grant Thornton, provided a breakdown of the ‘realised’ value of the company’s assets against the book value provided by Yes Recycling. This is what is used to pay preferential creditors.
The company’s assets were given a net book value of £5.53 million, with £4.39 million of this made from plant and machinery. However, the realised value outlined on Thursday was less than half of this, at £2.3 million. The difference was largely made up from the realised value of the company’s plant and machinery, which was £2.25 million compared to a book value of £4.39 million.
This meant there was a total of £2.3m available for preferential creditors.
The preferential creditors include Ecosurety, owed £1.47 million for the ‘Nestle PRN loan’ (see letsrecycle.com story), more than £2 million owed to Triodos bank, £859,000 to Morrisons, £93,990 for unpaid employee wages and more than £200,000 to HMRC. Morrisons is also owed £859,337 for a ‘PRN loan’. Trade creditors such as Cireco, Fife council and SSE Energy are owed a combined £800,007.
Combined, this led to the overall ‘deficiency’ of £3.489 million. Grant Thornton is likely to publish an updated statement of affairs in the coming months with more detail on how this will be broken up. According to Grant Thornton, Yes Recycling’s books and records, also show total unsecured creditors are estimated at £9.0 million (see letsrecycle.com story).
Yes Recycling
Yes Recycling owned a 15,000 tonnes per year capacity soft plastics plant in Fife. In November 2021, supermarket chain Morrisons acquired a “significant stake in the plant” and declared it open in February 2023 (see letsrecycle.com story).
However, the company was placed into administration in April 2023 because of “cash flow challenges” brought on by the plant “not being able to operate at full capacity” (see letsrecycle.com story).
A potential sale of the company collapsed earlier this year, a report showed (see letsrecycle.com story). The same report also detailed more information provided by the directors of Yes Recycling as to why the company collapsed.
One of the reasons was that the quality of feedstock provided by Fife council was “considered lower than specified in the supply agreement”. This resulted in “additional time and resources required to sift through the waste prior to production”.
The company also obtained an unsecured loan, detailed in the report to be from Morrisons, which was required to be paid back through PRNs, which was set at a fixed priced. This meant the company could not “benefit from the increased value” of PRNs.
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