Safestyle administration: Workers, suppliers and taxpayers set to lose millions
Former workers, creditors and taxpayers are to be left millions of pounds out of pocket from the collapse of leading window firm Safestyle, new reports from administrators have revealed.
The Bradford-based company went into administration at the end of October 2023, with around 700 jobs being lost and the situation also affecting self-employed contractors used by the business.
The Yorkshire Post revealed in December 2023 that subsidiaries of the company collectively owed more than £30m to various parties.
Progress reports by administrators have now published in regard to three related companies within the Safestyle group – HPAS Limited, Style Group Holdings Limited and Style Group UK Limited.
In the case of HPAS, administrators Interpath said unsecured creditors are collectively owed £13.5m which they are “highly unlikely” to receive any return on. It has previously been reported that the £13.5m for unsecured creditors included £9.7m owed to business suppliers, as well as £3.6m of unsecured employee claims understood to relate to areas such as redundancy payouts.
However, more than £900,000 of money which is owed to workers as preferential claims, including up to £800 per person in wage arrears, is expected to be at least partially repaid although the final amount cannot yet to be confirmed.
The HPAS report said £6.8m is owed to HMRC and there should be some form of dividend to the taxman, though the figure is yet to be determined.
A further £4.4m is owed to HMRC by the Style Group Holdings Limited subsidiary. Administrators said a “small dividend” is expected to be returned.
Another £4.5m is owed by HMRC by the Style Group UK Limited arm of the business and in this case it is expected there will be “insufficient asset realisations” to pay a return to the taxman. It is also deemed to be “highly unlikely” that £82,000 owed to former employees and £131,000 to former employees will be returned.
The company’s creditor Aurelius, which held security over all property and undertakings of the group, has already received £3.5m back.
To help claw money back, administrators sold £18m worth of unfulfilled customer jobs on Safestyle’s order book to fellow window installation firm Anglian for £2m.
The administration processes for the group’s businesses are expected to run until October.
When Safestyle collapsed in October 2023, factors including an “unseasonally warm September” were cited as factors in the company’s problems.
A statement by administrators said at the time: “In common with a number of companies across the home improvement sector, Safestyle UK has had to navigate a number of pressures which have impacted trading, including high cost inflation, ongoing economic uncertainty and fragile consumer confidence.
"In recent months, these pressures have been exacerbated by an unseasonally warm September, which has dampened customer demand.”
Rick Harrison, managing director at Interpath Advisory, said at the time: “These are really challenging times for companies across the home improvement market. After seeing strong sales during the Covid lockdown periods, many companies are seeing trading being impacted by the cost-of-living crisis and soaring costs.
“Unfortunately for Safestyle, and despite the tireless efforts of the management team over recent months, these challenges have proven too difficult to overcome.”
Union GMB blamed “mismanagement” for the firm’s failure.