The statement reads as follows:
"A new company has been formed by Gary Davis, Darren Glossop, Paddy Collier, Lauren Steadman and Divyang Mistry which saves the jobs of nearly 100 employees of PSL after adverse circumstances forced the Potters Bar-based event services operation into administration.
"Last month, PSL entered into a legal process called 'pre-pack administration', a routinely-used mechanism recommended by many insolvency practitioners to protect valuable parts of a business. It has strict compliance issues, formal valuations of assets and intellectual property, and requires personal guarantees from the directors. The process is being adminstered by Tenon Recovery, one of the UK's leading IPs, and is being backed by GE Commercial Finance and HSBC. All transactions involved in the process are a matter of public record. Both GE Commercial Finance, which invested £550,000 into the new company, and the HSBC were bankers for Presentation Services Ltd.
"The new company has purchased the assets of PSL from the Administrators for £800,000, a price determined by two independent valuations. By doing so, and creating a new company PSLL, they have:
• enabled 95% of PSL's staff to retain their jobs, with no adverse impact on their wages, expenses or overtime,
• honoured PSL's commitments to its customers and their shows, keeping continuity with its contracted clients,
• created a commercial vehicle which can offer employment and business opportunities in the future.
"The directors of the new company and its advisors truly believe that the actions they have taken will achieve a better result for the company's creditors than if PSL had been liquidated. In addition to the large sum received for PSL's equipment inventory, a percentage of PSLL's turnover in its first year of trading will be returned to the Administrators to pay creditors."
Gary Davis, formerly the managing director of PSL, comments: "On behalf of the board of directors, I should like to apologise to anyone who now has to seek redress from the Administrators. PSL experienced some significant problems in 2008, suffering over £300,000 of bad debt, its worst level ever, and uncovering evidence of serious financial irregularities by its former financial director. With the company's cashflow arrangements being compromised, we took the decision to begin the process of administration, ratified in a board meeting on 26 September. After a moratorium period, the Administrators were officially appointed on 17 October, on which day PSL ceased trading."
Davis says he and his fellow directors are ready and willing to explain the situation to any creditor, by phone or in person, and have spent the last two weeks talking to suppliers who have invoices outstanding.
Going forward, the directors of PSLL have published a Code of Best Practice, according to which the company will now increase its day rate paid to freelancers by £15, shorten payment terms, aiming to pay 21 days (and not more than 30 days) after receipt of invoice and pay a percentage of its first year's turnover to the Administrators to be passed on to creditors.
"It is a positive way for PSLL to show good faith to people who are very important to our future," says Davis.
(Lee Baldock)
