Feeds

Memsolve in eleventh hour crisis talks

Distributor's future in hands of creditors and financiers

  • alert
  • submit to reddit

Bridging the IT gap between rising business demands and ageing tools

Troubled components distributor Memsolve has admitted that it owes around £4 million to its creditors and that it may be forced out of business unless it can overcome crippling cashflow problems. Last week the company was forced to lay off around 20 of its 65 staff, and has been unable to pay its bills -- some of its suppliers have complained that they had received cheques which bounced. The troubled company said it has faced cashflow problems since a Customs & Excise raid last November. Memsolve, based in Widnes, Lancashire, is still trading but venture capitalists Northern Venture Managers and NatWest -- the distributor's bank -- are said to be considering their next move. Chris Walmsley, Memsolve's sales and marketing manager, said the next 24 hours would be critical for the company. "I don't know for definite. It's in the hands of the bank and venture capitalists. We could either be rescued or go into receivership," he said. Eddie Pacey, Ideal Hardware credit manager, could offer little solace for Memsolve: "We have considered the company to be a high risk for some time, especially since the VAT raid. The position is now so far advanced that some form of insolvency seems inevitable." Walmsley disagreed that there was no hope. He said there was a rescue package, but said it would depend on whether creditors were willing to enter into an arrangement which would buy the company precious time. This morning, Memsolve was still taking orders, but is unable to buy anything from suppliers. Walmsley said: "We've had to put the brakes on." On 4 November, HM Customs & Excise, accompanied by Intel and Microsoft representatives, raided Memsolve's premises. According to the company, the raid was connected with a VAT fraud, allegedly committed by one of its British-based suppliers. It came three weeks after Customs officials raided a computer parts supplier -– no longer trading -– in the North West of England (see Memsolve bounces back after Customs raid). Shortly after the November raid, Memsolve's debt insurer, Trade Indemnity, pulled any new cover for creditors. It was reinstated at a reduced rate shortly afterwards. However, the insurers have again withdrawn the cover. Walmsley said: "We had an absolutely fantastic business. It's been ruined." ®

Build a business case: developing custom apps

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple ran off to IBM
But never fear fanbois, you're still lapping up iPhones, Macs
Nadella: Apps must run on ALL WINDOWS – PCs, slabs and mobes
Phone egg, meet desktop chicken - your mother
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
HP, Microsoft prove it again: Big Business doesn't create jobs
SMEs get lip service - what they need is dinner at the Club
Samsung threatens to cut ties with supplier over child labour allegations
Vows to uphold 'zero tolerance' policy on underage workers
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
prev story

Whitepapers

Seven Steps to Software Security
Seven practical steps you can begin to take today to secure your applications and prevent the damages a successful cyber-attack can cause.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.