The major wholesaler Palmer and Harvey have gone into administration. 2,500 jobs are to be lost at the head office and branches across the network.
According to the administrators PwC, Palmer and Harvey had suffered due to challenging trading conditions in the last few months. Attempts to restructure the business have been unsuccessful. Cash flow pressures resulted and it wasn’t possible to secure additional funding to support the company.
The company, known as Palmer & Harvey McLane Limited, is the UK’s largest delivered wholesaler to the UK convenience store market. Palmer and Harvey has close to 90,000 customers from local corner shops to some of the UK’s largest supermarkets.
The Palmer and Harvey network includes 14 distribution centres that supplied up to 12,000 product lines. P&H Direct Limited provide product delivery services to independent retailers and food outlets.
Only one company in the group, WS Retail Ltd, has not been put into administration and will continue to trade as normal.
The administrators have said they hope to sell P&H Direct Van Sales Limited, P&H Sweetdirect Limited and P&H Snacksdirect Limited, all subsidiaries of Palmer & Harvey McLane (Holdings) Ltd.
The group employed a total of some 3,400 employees. The administrators said some 2,500 people had been made redundant. “The remaining employees will assist the joint administrators in managing the activities of the business to an orderly closure. Currently 450 employees have been retained within the wholesale business.”
Before they called in the administrators, Palmer and Harvey’s management had been in takeover talks with private equity firm, The Carlyle Group. This would have included Carlyle taking control of the equity of Palmer & Harvey McLane (Holdings) Limited. The talks failed.
Matthew Callaghan, joint administrator and PwC partner, said: “The P&H Group has faced a challenging trading environment, and the need for significant restructuring has been recognised for some while. The company has insufficient cash resources to continue to trade beyond the short term and the directors have concluded that there is no longer any reasonable prospect of a sale. Therefore, the directors have had no choice but appoint administrators.”
The companies in administration are:
Palmer & Harvey (Holdings) PLC; Palmer & Harvey McLane Limited; Palmer & Harvey McLane (Holdings) Limited; P&H (1925) Limited; P&H Direct Van Sales Limited; P&H Sweetdirect Limited; P&H Direct Limited; and P&H Snacksdirect Limited
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