LONDON (Alliance News) - Litebulb Group Ltd on Wednesday said its subsidiary Concept Merchandise Ltd has been sold to private company Woodvale Studios Ltd for GBP169,000, under its ongoing disposal process.
Litebulb in March said it would sell its trading businesses after it decided not to pursue new financing or any associated restructuring of its debt, and its shares were suspended from trading on AIM upon its request.
The sale of Concept, which took place on Friday, comes after Litebulb announced three other disposals of subsidiaries last week. All four had been placed into administration by Litebulb.
On Wednesday, Litebulb said four companies had originally expressed interest in buying the Concept business, with three moving to due diligence phases, resulting in a formal offer from one of the parties. However, this offer was withdrawn and Concept was placed into administration on April 1.
Woodvale Studios then made an offer for the business "in order to preserve the jobs of the Concept team". Litebulb Interim Chief Executive Howard Partington and Finance Director Guy Pettigrew are directors and minority shareholders of Woodvale.
As the sale was to connected parties, the transaction was referred to an independent panel, Pre-Pack Pool Ltd, which said it found that there was nothing "to suggest that the grounds for the proposed pre-packaged sale outlined in the application are unreasonable" on Thursday.
Litebulb said it received the full GBP169,000 consideration and said there was no further balance outstanding.
"Given that the debtor book was retained by the joint administrators, with Woodvale entering a collection agency agreement for the latter as part of the sale of business contract, it is likely that the resurrection of the business under Woodvale ownership will produce a significantly enhanced outcome than if the sale had not taken place and realisations were made piecemeal without continuity of trade," Litebulb said.
By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland
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