Millennium went bust owing over £2m to unsecured creditors

Administrator's report reveals extent of Millennium fallout, with three distributors owed over £300,000 each

Millennium Business Systems (MBS) went bust owing £2.1m to 197 unsecured creditors, a recently filed administrator's report has revealed.

MBS went bust last year after a failed attempt to refinance left it with no choice but to call in administrators.

A report, available to view on Companies House, has now revealed that MBS had been close to securing its refinancing. However, a winding-up petition was filed by a supplier after a £237,508 invoice went unpaid, meaning the deal fell through.

As a result, the firm ceased trading on 27 November, with 30 members of staff let go immediately and four kept on to help with the administration process.

Of the 197 unsecured creditors the largest are Exertis (£408,600), Tech Data (£350,000), Midwich (£310,600) and Westcoast (£171,600). HM Revenue and Customs is also owed £114,200.

A host of resellers and distributors are also owed varying amounts under £50,000.

In the report the administrator said that there will be money left over to pay unsecured creditors once secured creditors have been paid, but stopped short of giving any guidance on how much this is likely to be.

The only preferential creditors are the firm's employees, owed a total of £41,000, whom the administrator said are likely to be paid in full.

Last month CRN reported that ex-MBS director James Baxter had acquired the firm's stock via Albuhera Limited, in a move that would boost the return to creditors.

The report shows that Albuhera paid £55,000 plus VAT for Millennium's stock.

CRN has contacted Exertis, Midwich and Westcoast for comment. Tech Data declined to comment.

In the full year ending 31 December 2016 MBS reported revenue of just over £8m, and in the following year to 31 December 2017 was expecting to see year-on-year growth of 35 per cent, according to the report.

However, it became apparent by August 2017 that this was not going to be achieved, the report added, at which point the MBS began to struggle as a result of investing in staff ahead of the anticipated growth.

It was at this point it began cost cutting and sought the change in finance, ahead of realigning the business for future trading.

These plans were however scuppered when a supplier issued a winding-up order after not having a £237,508 invoice paid.