Further re sale of business and assets

    RNS Number : 6112A
  Greatfleet PLC
  04 August 2008
   


    For immediate release

    4 August 2008

    Greatfleet plc
    ("Greatfleet" or the "Company")

    Further statement re the administration and 
    disposal of certain of the businesses and assets of the Company

    Further to their appointment as joint administrators to the Company on 29 July 2008 Michael Healy of Leonard Curtis and Paul Boyle of
Harrisons (the "Joint Administrators") are today providing an update on the events leading up to their appointment and the recent sale of
certain of Greatfleet's businesses and assets.

    Due to a demand for immediate repayment by HM Revenue and Customs in relation to a significant PAYE liability and the inability of the
Greatfleet group (the "Group") to settle this demand (either now or in the future), the directors of Greatfleet (the "Board"), after taking
appropriate professional advice, resolved to file a notice of intention to appoint administrators on 11 July 2008.  

    This provided Greatfleet with a 10 day Court moratorium preventing any action by creditors without the Court's permission whilst the
Board and its advisers considered various options. This included the Board taking insolvency advice and the administrators instructing
independent valuers to consider a sale of the Group's business and assets and to pursue offers for its business.

    Following a review of the options available, it became clear that the Group was unable to continue to trade due to its working capital
position and, it was considered appropriate to file for the appointment of administrators.  During this period, as a result of the acute
financial condition, the Group had restricted access to any working capital finance and were faced with the likely possibility that the
month end salaries for July would not be paid. No other forms of funding were available to the Group nor did any third party offer
additional funding. The initial 10 day moratorium period ended on 24 July 2008 and a further notice of intention to appoint administrators
was filed on 25 July 2008.

    Faced with a rapidly deteriorating financial position, the serious concerns of the Group's staff, clients and mindful of the Board's
responsibility to creditors, the independent valuer sought offers from parties for the Group's business and assets for the purpose of
maximising value for the Group's creditors. As timescales were extremely limited, detailed information was not available to allow for due
diligence to be conducted.    

    Initial offers were requested by 25 July 2008 and further discussions took place on 28 July 2008 and 29 July 2008, culminating in the
appointment by SME Invoice Finance (the secured creditor) of the Joint Administrators on 29 July 2008 to progress a sale in an attempt to
preserve value for the Group's creditors as a whole. At this time the obligations, duties and responsibilities of the Board were assumed by
the Joint Administrators, as required by Insolvency legislation. 

    Due to the lack of any available funding, the immediate wage requirement of up to £200,000, the concerns of the Group's clients
regarding the future of the business and the uncertainty as to ownership of the assets of the business, the Joint Administrators who had
relieved the Board of its ongoing responsibilities concluded the immediate sale of the trading assets of the Group to the party that, in
their opinion, provided the maximum return to creditors. This party was QPS Limited, a company connected to Colin Gerstein, Chief Executive
of Greatfleet.

    The sale of certain of the Group's business and assets to QPS Limited, a company connected to Colin Gerstein, the Chief Executive of
Greatfleet, constitutes a related party transaction under the AIM Rules for Companies. The sale carried the recommendation of the
independent valuers on behalf of the Joint Administrators.

    For further information please contact:

    Greatfleet plc
    Sir John Baker, Chairman                                                      Tel: [phone]

    Noble & Company
    Nick Naylor and Nick Athanas                                             Tel: [phone]

    AVS Publicity (PR adviser to the Joint Administrators)
    Alison Sutherland                                                                   Tel: [phone]



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