Directors who dissolve companies to write off debts, only to start up near identical businesses shortly after, could be banned and fined under new regulations.
The government has moved to crackdown on so-called ‘phoenix companies’ as part of a raft of changes intended to protect employees and pension holders when companies are shut down.
Retail tycoon Mike Ashley has been quick to position himself as champion of the high street after buying House of Fraser out of administration. But whether suppliers, pension holders and even landlords will be celebrating the takeover is questionable.
The Sports Direct owner snapped up the struggling department chain for £90m just an hour after entered administration last week, vowing to keep open at least 80% of its UK stores open.
More than a quarter of UK businesses have suffered negative consequences from another company becoming insolvent in the past six months.
A survey carried out by R3 revealed that one in 10 businesses have suffered a ‘very negative’ impact from a customer or supplier becoming insolvent since the start of 2018, while another 16% reported a ‘somewhat negative’ effect.
The figures come after a sharp spike in the number of companies being declared insolvent in the first quarter of this year. Led by the high profile collapses of Carillion, Toys R Us and Maplin, the number of insolvency cases rose an alarming 13% from the previous quarter.
The Church of England fears that it could be forced to sell off some of its prized cathedrals in order to stave off bankruptcy - and is seeking to pass news laws to prevent that happening.
At the General Synod of York - the CoE’s equivalent to Parliament - bishops were presented with a report detailing the financial difficulties of diocese including Exeter and Peterborough, both of which are centred around historic cathedrals.
Fears over the future of embattled toy retailer Toys R Us continue to mount after its UK business announced it was to seek a Company Voluntary Arrangement (CVA) to handle a mounting debt crisis.
The company, which is thought to have made a trading loss for seven out of the past eight years, has announced plans to close a minimum of 26 stores in the UK, with a loss of 800 jobs.
Wholesaler Palmer & Harvey has entered administration after failing to restructure significant debts owed to suppliers.
The Palmer & Harvey Group, the UK’s fifth-largest privately owned business and the country’s largest tobacco supplier, had been in takeover talks with Carlyle, the private equity firm.
There have been plenty of stories in recent times of large corporations going bust, leaving a trail of out-of-pocket suppliers and creditors in their wake.
But it would be wrong to assume this is the kind of thing that only happens in the world of big business. Even down at the ‘grassroots’ level of microbusinesses and one-man-bands operating in niche cottage industries, where the principles of trust and your word being your bond are still believed to hold sway, things can go wrong.
Latest official figures have confirmed what most people in business already suspected - the UK economy isn’t looking in too great a shape. Growth has stalled to a virtual standstill, just 0.1%, following the worst quarterly performance in five years in the first three months of 2018.
Confidence is low amongst both businesses and consumers, with investment and household spending both down - two factors which, of course, feed one another. In addition, the early months of 2018 have witnessed a succession of big-name company failures, from high street chains like Toys R Us and Maplin, to public sector outsourcing giant Carillion.
It seems that no news is good news when it comes to tales of insolvency and corporate debt across the UK economy at the moment. Maternity and baby specialist Mothercare is the latest name to join the swelling ranks of high street retail chains teetering on the brink of collapse.
Mothercare has announced plans to close a third of its stores - a total of 50 outlets - as part of a proposed Company Voluntary Arrangement (CVA) to offset losses of £72.8m in the last financial year. If approved by creditors, the move is expected to see up to 800 jobs cut.
The Parliamentary report into the collapse of disgraced outsourcing giant Carillion has certainly pulled no punches.
Amongst the tastiest soundbites, MPs have accused bosses of ‘stuffing their mouths with gold’ while the company’s finances floundered, summing up their behaviour as ‘recklessness, hubris and greed’.