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Palmer and Harvey chief’s £3.4m loan prompts fresh questions over Hove wholesaler’s collapse
Posted On 02 Jan 2018 at 12:06 am
The terms of a £3.4 million loan to the former chief executive of a collapsed Hove company have prompted fresh concerns.
Palmer and Harvey (P&H) went into administration with the seven-figure sum owed to the wholesaler by former boss Chris Etherington.
According to the Sunday Times, P&H directors agreed to change the terms of the loan so that it would have to be repaid only if Mr Etherington, 65, sold his shares in the business.
This looks impossible now that P&H is in administration.
The collapse of the business cost almost 3,000 people their job – more than 400 of them worked at the old head office in Davigdor Road, Hove.
The Sunday Times said that a small group of executives and managers had been paid dividends totalling almost £77 million since a management buyout in 2008 that loaded P&H with debt.
The company, which supplied thousands of corner shops, garage and convenience stores with snacks and cigarettes, went under with debts estimated at £65 million, the newspaper said.
The pension fund is believed to have a huge shortfall, according to other recent newspaper reports.
And many of Palmer and Harvey’s staff were thought to have been banking on significant future lump sums, having bought shares in the company which are now likely to be worthless.
The Labour MP Frank Field, chairman of the House of Commons Work and Pensions Select Committee, has asked questions about the pension deficit at P&H.
Mr Field is also reported to be calling for the administrators, from accountancy firm PwC, to force Mr Etherington to repay his £3.4 million loan.
The Sunday Times quoted PwC as saying: “In line with their statutory responsibilities, the administrators will investigate the circumstances leading to the failure of the business in due course.”
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If the story is correct, that a small group of executives agreed bonuses etc to themselves totalling some £77 million, then there has to be a criminal case against all of them.
This is asset stripping, as the debts when it collapsed were £65 million, so there would have been sufficient if these extraordinary payments to the fat cat bosses hadn’t been granted. And ho agreed these amounts? The bosses themselves….
There needs to be some legislation to prevent other Directors and Officers from creaming all the worth out of a business and letting it collapse, leaving the employees with worthless stock and share options and huge pension deficits.
This company appears to be the tip of an iceberg – and it’s not the bosses that lose, they’ve done very nicely for themselves out of greed, not for the good of the business.
2008, eh? Management buyout? The ingredient to save the curdled mayo from the global meltdown was training and/or spending on expertise (if they lacked needed skills).
Overconfident, underskilled, naive, greedy or worse? This looks worrying like the BHS story to me.
An absolute disgrace. Rumours abound about directors taking huge amounts of money from Palmer and Harvey whilst it was clearly in distress. They gave no thought to the many current and former employees who could lose thousands of pounds.
Trust PwC will investigate and bring those who are guilty to bought to book and answer the many questions which surround their actions.
Worked at the haydock depot for 13 year’s, and all we had is 2 small pay raise in the last eight years. I hope they all get what’s coming to them, if there is any justice.
worked loyally to P&H for over 30 years to come to this the Big fat cats taken all my Shares and reducing my Pension in my eyes this is Stealing and putting clauses on the loan He knew what he was doing I WANT the Powers to be to take revenge for all us ex employees AND SOON justice must be enforced…….
Let’s hope so Andy we have all been robbed. They should also delve into the finances of Chris Adams and all the directors since 2008.
Management were nothing less than robbing rogues, make them sell their assets and make up pension fund short fall
I worked at p&h for just over 5 years and gave my blood to that company. The big fat cats just took all the money and then we got shut down. If any of us was caught eating a chocolate bar off the shelf the police would be called and we would be hangcuffed and frog marched out in front of everyone and put before the courts to be sentenced and even maybe jail. So why the hell can the BIG CATS get away woth it ?????
You greedy ba####d!You took away our livelihood, our jobs and jeopised our homes for your own greed!!! You deserve, and need to pay and answer for all you’ve done to your hard working employees! You at least owe them that.
I worked at p&h for 35years i have put my life and & sole and sleepless nights into the company with all the difficult situations we have faced over the years. What for I ask myself for the thieving senior management to waste money on the”evolution project “etc then we wake up one morning to be told clear your belongings and leave the premises. These people were at the helme of the business and had a duty of care to the staff and the company.These people are millionaires and live in big houses with no worries.The government need to look into this to protect other companies and these directors should face prison and be made accountable Winston Churchill once said. WE WILL NEVER SURRENDER!!!!!
Nigel Grist
I worked for Palmer and Harvey for 20 years, leaving about ten years ago.When I started, the directors were honest upstanding people, who made P&H a ‘people’ company. Who remembers Philip Hudson and Graham Mcpherson, who were always accessible and supportive.
Shame on those directors who have brought with them a different agenda and now have the collapse of a once famous and respected company and the loss of 3000 jobs on their conciences if they have any.
Further to my comments above, I’ve discovered that Etherington has set up Chris Etherington Ltd with his wife.So ‘I’m all right Jack’
Companies House website shows that the Company is involved in Management Consultancy, but not Financial Consultancy. I wonder why?
Maybe he’s keeping his £3 million under the bed ready for him being forced to hand it back!
There seem to be skeletons falling out of cupboards everywhere regarding P&H.
Such a shame, as I and many others used to look up to these subsequently disgraced individuals.