Fri, 08 Dec 2023 | BUSINESS SALE
Heat Recruitment, a recruitment consultancy with operations in Bristol and Manchester, has been acquired out of administration by Welsh recruitment group Smart Solutions Group in a pre-pack deal. The deal enables Smart Solutions to establish its first presence in Manchester and to expand into the Bristol market.
Smart Solutions has acquired the business via a newly formed company called Heat Recruitment Limited, formerly RJWVSUB01 LIMITED. The firm will pay £125,000 in two tranches to acquire the business from administrators at Leonard Curtis.
Heat Recruitment fell into administration after racking up significant debts as it struggled during the COVID-19 pandemic. It had amassed £900,000 in debts to HMRC, which it was unable to service at a rate of £18,000 per month.
The firm owed a further £500,000, including a CBILS loan via Funding Circle and lending for the fit out of its Bristol office with Aldermore Bank. It also owed £376,611 as part of an invoice discounting agreement with Ultimate Finance.
During 2022, the company’s top line sales rose to £8.6 million, having fallen to £3.5 million in 2020 and recovered to £5.6 million in 2021. However, despite this recovery, the firm still fell to a loss of around £468,000.
The company was subsequently acquired after being placed into administration, with the pre-pack deal meaning that the business can continue trading under its existing brand and all 51 members of staff transferring to the new company. According to the administrator’s report, Ultimate Finance, as charge holder, has been repaid in full from book debt collection, but is still seeking an £84,640 repayment from the director’s loan account.
Smart Solutions Chief Executive Rob Webb (pictured above with Heat Recruitment CEO Steve Preston) said that the deal “will be pivotal in delivering the doubling in growth the group is expecting in the next 12 months.”
Webb continued: “A key component of this growth will be our offer to clients across the north and the Manchester foothold this deal gives us, is the perfect platform upon which to build. It will strengthen our position in the market and open new avenues of opportunity for both professional and personal development of the newly combined teams.”
Heat Recruitment Chief Executive Steve Preston, who revealed last week that the company is planning to open a new office in Birmingham, added that deal “enables us to build on our existing capabilities and to foster a dynamic environment for innovation.”
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