Carpetright’s recent collapse has left customers, suppliers, and landlords facing an estimated £213 million loss, with many expected to recover less than 1p for every pound owed.
The collapse of Britain’s largest flooring chain has impacted hundreds of unsecured creditors, including high-profile names such as Royal Mail and Microsoft, according to administrators’ proposals obtained by The Times.
Among the creditors, carpet suppliers Betap and Condor were owed £1.9 million and £1.1 million, respectively. Microsoft was owed £3.1 million, waste management company Biffa £852,000, Royal Mail £372,000, and logistics company DHL £540,000.
The total liabilities of Carpetright are estimated to be around £338 million. This figure includes the amount owed to customers who had paid in advance for goods and services, although this specific amount was not detailed in the document.
PwC, acting as administrators, calculated that HM Revenue & Customs (HMRC) was owed £9 million, with expectations that this debt will be nearly fully repaid.
As a secured creditor, Carpetright’s owner Nestware Holdings is first in line for any payout. Nestware has a claim for £120 million, but the proposals suggest it is unlikely to recover any of this amount.
Nestware is owned by Meditor, a British hedge fund led by Talal Shakerchi, known for his poker alias “Raidalot”. Shakerchi has faced criticism for moving £12 million of secured debt into the company in December in exchange for Carpetright’s intellectual property, which was subsequently transferred to Nestware.
A source close to the situation has called for an end to such restructuring deals, which allow brands to continue trading debt-free while leaving creditors out of pocket.
Carpetright’s administration has resulted in the closure of 273 stores and 1,500 job losses. Its remaining 53 stores were acquired by Tapi, a main competitor, through a pre-pack administration deal that included the transfer of 308 employees.
The administration filing followed a winding-up petition from HMRC for unpaid VAT and PAYE payments, previously reported to be approximately £4.6 million in VAT and £5.1 million in payroll and PAYE at the end of April.
Carpetright also suffered a cyberattack in April, disrupting its ability to trade for over a week. PwC noted that this incident exacerbated the business’s already precarious financial situation.
The company had been struggling for several years, failing to recover even after a company voluntary arrangement in 2018 led to the closure of numerous stores.
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Carpetright’s collapse leaves creditors facing £213m loss