System integrator Watford Electronics entered administration last week, owing almost £8m, after 35 years in the industry.
Financial services firm Smith & Williamson was appointed as administrator on 7 February. On the same day, a company called Globally Ltd purchased the business of Watford Electronics. Companies House records showed that Globally Ltd was incorporated on 5 February 2007 and registered to the same address in Luton as Watford Electronics.
Nitin Joshi, founder of Channelmoney, which is representing about 70 per cent of Watford’s creditors, said: “Watford owes some £3.6m to the trade, and with what it owed to the family [who own Watford], then the deficiency is probably more than £8m. The assets are negligible in relation to the size of the company’s debt so dividend prospects to creditors are dismal.”
Joshi has been approached to provide strategic assistance to Globally, but said: “Clients need to know more about inter-company transactions, stock movements and details of the deal with the administrator and have asked me to call an urgent meeting.
“Directors tell me that they tried everything to reduce the damage, but clearly I need to know more about these actions.”
Tony Riccardi, general manager at system builder Mesh, said: “The news hasn’t come as a shock because we operate in a tough market. Credit insurers have been aggressive over the past year with IT companies.”
Jon Atherton, group vice-president, commercial, at distributor Enta Technologies, said: “It’s very sad to see such a channel stalwart go.”
In October Watford, which is managed by Shiraz Jessa, partnered with Microsoft, Intel, LG and BT Wholesale to launch what it claimed was the UK’s first out-of-the-box broadband and PC package, Redten Internet.
An industry source told CRN: “Watford had been in financial trouble for some time. Redten Internet was going to be its get-out clause but it didn’t really take off.”
As CRN went to press, the Redten web site was still up and running, but could not process any orders due to “maintenance problems”.
Watford Electronics was unavailable for comment.
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