Unitech Industries has stepped in to buy the business, assets and intellectual property rights of Francis Catering Equipment, after the Midlands-based distributor was placed into voluntary insolvency, along with its associate company, Stockport-headquartered Design Catering Equipment. Francis had previously purchased its fellow dealer after this went into administration in 2014.
Steven Stokes and Raj Mittal from FRP Advisory were appointed joint administrators for the case on 4 September. The insolvency practitioners have managed to craft a deal with Unitech which secures all 40 jobs at the firm, as well as ongoing trading.
Unitech Industries is a large and diversified manufacturing group based in the West Midlands, which also owns Livingston-based ScoMac Catering Equipment. The firm stated that it took this action at very short notice in order to preserve the businesses.
The new business will trade under the name of Francis Commercial Kitchen Services and continue specialising in the design and installation of commercial kitchens for clients from the group’s main office in Kingswinford, the West Midlands, and a satellite warehouse in Stockport, Greater Manchester.
Francis Catering has over 40 years of trading, serving clients with catering equipment and industrial kitchen installations, having expanded in response to growth in the market.
As part of the group’s expansion, the securing of new, larger contracts involved upfront capital investment, which had put unsustainable pressure on cash flow and working capital. After being unable to secure additional new funding, the group was left with no viable alternative to ensure ongoing trading, other than to seek a sale of its businesses and assets via administration.
Steven Stokes, joint administrator and partner at FRP Advisory, said: “This is a positive result for a long-established business, securing the jobs of a skilled workforce in the West Midlands and Stockport. Unitech Industries provides the ideal support and depth of management experience to provide Francis with the platform to prosper in the future. We wish the Francis business and their staff every success under their new ownership.”
Nick Imlah, group MD at Unitech Industries, issued the following statement: “We are glad to have been able to secure the future employment of such a large number of people. I look forward to working with the teams at Kingswinford and Stockport to re-build the brand and reputation of Francis; a successful business for 40 years.”
Unitech hopes to be able to support Francis in its future dealings with its new customer base.
However, Catering Insight understands that Francis Commercial Kitchen Services will not be taking on Francis Catering Equipment’s existing debts.
Companies House records show that the name Francis Commercial Kitchen Services was registered on 30 August, using a dormant company which was first incorporated by the Unitech Group as Unitech Herbert Systems on 1 August 2016. It then changed its name to Food Service Eng’ UK on 24 February this year, before the current conversion.
Francis Catering Equipment’s latest available accounts from Companies House also show that for the 2015 calendar year the distributor turned over more than £6.5m with a gross profit of over £1.5m. In an 18 month accounting period prior to that, ending 31 December 2014, turnover was recorded as £10.3m with a gross profit of nearly £2.3m.