Breathe Networks administrator to hold creditors' meeting

Unicorn takes deep breath

The latest administrator’s report also revealed that a limited company based in the British Virgin Islands was instrumental in the sale of BNL’s assets to Kaye after the firm went titsup.

Unicorn Worldwide Holdings Ltd bought the business and assets of BNL on 17 July for £300,000. “This was immediately set-off against the secured amount owing to Unicorn Worldwide Holdings of £733,000,” said Chesterton.

“There are no options or buy-back arrangements or similar conditions attached to the sale. This offer was accepted as it significantly exceeded any of the other offers received.”

On the same day Unicorn Worldwide Holdings Ltd “completed a sale of the business and assets purchased from the administrator of BNL to Breathe Internet Ltd for a deferred consideration of £288,000”, according to the administrator’s report.

In June this year BNL had its assets valued.

Charterfields LLP valued the company’s office furniture and kit at £2,000 on an “in-situ” basis, while the amount ascribed to goodwill was set at £12,000. As a result, interested parties were told they could approach the firm with offers over £14,000 to buy BNL’s assets and business.

Besides Unicorn Worldwide Holdings Ltd, two other companies approached the administrator expressing interest in the sale of BNL, according to Chesterton.

The firm’s DSL provider Murphx Innovation Solutions Ltd, along with mailbox provider Spider Networks Ltd, discussed the proposed management buyout with the administrator.

Murphx is listed as a major unsecured creditor in Chesterton’s report. BNL has outstanding payments of £207,617 with the DSL outfit.

Despite that hefty sum, Murphx has remained sympathetic to Breathe’s predicament.

“We were made aware of potential issues when Steve Kaye took control of the business and he has kept us up to date with the situation since that point," the company’s spokesman Carl Churchill told El Reg on 24 July. "We have had visibility of the plan of the new Breathe business and are comfortable with their objectives and expectations.

“As a result we have taken the decision in an effort to maintain continuity and limit disruption to the thousands of broadband customers we service on their behalf to support the new company moving forward.”

Murphx confirmed to us this morning that it would continue to support Kaye's new business. An initial creditors’ meeting is set to take place at TMP’s office* on 3 September at 11am.

"We are undecided regarding our attendance to the meeting as yet, as you are in possession of the documents you will be aware there is no likelihood of Murphx receiving anything towards the amount owed as such I'm unsure of the benefit of attendance as yet," said Churchill.

It's a different story for BNL's other major unsecured creditor, Bristol-based Spider Networks, which is owed £21,000. Last month it slammed Kaye's management buyout and accused the ISP of being in breach of contract after the company went titsup.

The Register contacted Kaye for comment about this story, but at time of writing he hadn’t returned our call. ®

*The administrator’s address is Level 25, Tower 42, 25 Old Broad Street, London, EC2N 1HQ.