Tue, 05 Mar 2024 | BUSINESS SALE
Deep Beat Entertainment Limited, a company that operates cafes at UK heritage sites and National Parks, has been rescued from administration. The company fell into administration in the face of mounting headwinds, with Howard Smith and Will Wright of Interpath Advisory appointed as joint administrators.
The company had struggled after revenue was severely impacted by COVID-19 lockdowns, with these financial pressures more recently exacerbated by high cost inflation, in particular the rising costs of food, drink and labour, which hampered its ability to service its debts.
In Deep Beat Entertainment Limited’s financial accounts for the year to October 31 2022, its fixed assets were valued at £1.97 million and current assets at slightly over £1 million. At the time, however, its net liabilities amounted to just under £220,000.
The firm’s management team sought to undertake a review of possible sale or investment options, but a solvent solution could not be found, leading to the decision to appoint administrators.
Tom Swiers, head of the Food and Drink sector team at Interpath, commented: "Whilst there has been recent improvement in food price inflation, producers continue to come under pressure with rising costs, particularly the cost of labour which is set to increase imminently with the forthcoming rise of the National Living Wage.”
"There is no surprise therefore that this cost pressure is being borne further down the supply chain by those operating in the food service segment, alongside what is well documented via rising prices within the supermarkets."
Upon their appointment, the joint administrators immediately concluded a sale of the majority of the business and assets to LCR Operations Limited, a connected party by way of the shareholder and director. The deal will see all venues continuing to trade, with 121 staff members transferring to the buyer.
Following the sale, the joint administrators are now sole shareholder of Park Life Resorts Limited, a Devon holiday resort with several short and long-stay woodland lodges. The joint administrators are now seeking a buyer for this shareholding.
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