Administrators seek to sell farm shop as going concern
Mon, 08 Jan 2024 | ADMINISTRATION
Administrators are seeking to sell Keelham Food Hall in North Yorkshire as a going concern, following its sudden closure at the end of last year. Jonny Marston and Lyn Vardy of professional services firm Alvarez & Marsal Europe LLP were appointed as joint administrators of the food hall and restaurant on January 5 2024, following its closure on December 28 2023.
The business, which is based in Skipton, sells local produce in its food hall, serves meals from a restaurant, features an on-site baker and butcher and also operates an online food store. Cost-of-living pressures, food inflation and high interest rates were blamed for the business’ closure.
In a statement, the business said it had not "been able to attract enough regular shoppers to cover the ever-increasing fixed overheads of the store and create a viable business moving forward". It is currently not trading while a sale process is undertaken by the joint administrators, who say there has already been interest in acquiring the company.
Joint administrator Jonny Marston commented: "The business has experienced financial difficulty in recent months as a result of cost inflation, which ultimately led to cashflow problems and the business ceasing to trade last week.”
"The joint administrators' priority is to explore options to sell the business as a going concern and have already been made aware of interest from several parties. Interested parties are invited to register their interest directly."
Prior to its recent struggles, the business had seen relatively strong performance in the wake of the COVID-19 pandemic. In its accounts for the year ending January 30 2022, Keelham Farm Shop Limited reported turnover of £8.6 million, slightly up from £8.5 million a year earlier, while cutting its post-tax losses from £562,401 in 2021 to £77,308.
At the time, the company’s fixed assets were valued at £5.4 million and current assets at £761,590, with net assets amounting to £837,488.
Due diligence is always a vital part of M&A, but even more so when acquiring distressed businesses
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