The parent company of the Liverpool Signature Living hotel group collapsed in administration because of £ 113 million to creditors.
Signature Living Hotel ltd is the parent company of the group’s extensive network of 60 hotels, residential complexes and other initiatives.
It is the largest of the six group companies to be managed.
Now a new report published by the appointed directors has exposed the extent of the company’s problems, which estimate that creditors owe a total of £ 113,331,594.
The report also reveals that Lawrence Kenwright recently created a new legal entity and transferred all of the shares in the Signature group to it, before receiving orders to return them to the directors, which he did.
Matthew Ingram and Michael Lennon, of Duff & Phelps, are joint directors of the parent company, Signature Living Hotel, and two other group companies, including the Shankly Hotel, which is also in administration.
They believe that an ongoing sale of the company is currently unlikely as there are “as there are” insufficient funds and resources available to enable the company to be rescued “.
The report adds: “Despite the Group’s significant real estate interests, the level of guaranteed and unsecured debt towards which the Company is directly and indirectly responsible for significantly exceeding the initial expectations of the value of the Company’s direct and indirect assets”.
The directors expect that “the Company will be dissolved once all pending administration issues have been resolved”.
Signature Living was founded by Lawrence Kenwright and his wife Katie.
The report says that as for the parent company, Katie Kenwright resigned as an adviser in December 2019.
ECHO has for some time been reporting on complaints from people who have invested in signature systems with the promise of significant returns – with many telling us that they have not been reimbursed.
The administration report states: “” Historically the company has been subject to various actions of the creditor’s application for non-payment of the amounts due and requested. These actions were previously resolved until the execution procedure was concluded. “
The directors are currently working to unravel the complex network of several companies within the Signature group, as well as relationships with investors, creditors and companies.
The report states: “At present, it is too early to provide creditors with early dividend prospects. A further update will be provided in the next report to creditors.”
Coronavirus blockade certainly impacted Signature Living, but its problems were well documented before the pandemic – with Kenwright selling its two most popular hotels – The Shankly and 30 James Street – on sale in May. last year.
While the company at the time claimed that this sales plan was to “fund future investments”, the administration report suggests that it was made to try to provide funds to meet the company’s various liabilities, including “chamber investors.” from bed “to which they owed cash.
But sales never happened and joint administrators were appointed in April.
The report reveals that during their investigations into the company, the directors discovered that the shares of the parent company and all the subsidiaries had been transferred to a new legal entity which had been set up by the director, Lawrence Kenwright to form the new parent company. of the larger Signature group.
The report explains: “After discussions with the director and after legal and tax advice, these transfers were canceled and the Company resumed its role as final shareholder of the larger group.”
The first of the Signature Living groups to fall into administration was the Shankly Hotel, which collapsed on April 16, a few weeks after the announcement of the national blockade.
This was followed by individual companies covering hotels such as 30 James Street in Liverpool, the Coal Exchange in Cardiff and the George Best Hotel in Belfast, as well as residential projects such as 60 Old Hall Street in Liverpool.
These resources are now managed by several administrators.
In terms of creditors and investors and the money they owe, the directors believe that their plans will provide a “better result” than would be probable if the company were liquidated.
The report states: “The administration provides protection to the group’s hotel and residential resources and a platform from which it is possible to implement a realization strategy to maximize the value of the assets that may not be available if it had been liquidated.
“The directors believe that a distribution will be made to the company’s creditors through the sale of certain proprietary and proprietary interests.”
ECHO was unable to make contact with Signature Living or Lawrence Kenwright.