Exclusive
By Scott Wright
A BALFRON-based prawn farm has ceased trading following the collapse in demand from the hospitality industry during lockdown, The Herald can reveal.
All eighteen jobs have been lost at Great British Prawns Limited, which halted operations shortly before calling in the administrators.
The company harvested warm water king prawns at its saltwater farm in Stirlingshire, and moved into the home delivery business last summer after its normal route to market was closed off because of coronavirus.
However, the switch was not enough for Great British Prawns to overcome the decline in demand from the hospitality sector.
The firm had also been affected by disease in its prawn stocks, which caused it to lose a harvest and led to the suspension of production in late December, documents filed at Companies House show.
Joint administrators Donald McNaught and Graeme Bain of accountancy firm Johnston Carmichael have been focusing their attention on finding a buyer for the company’s tangible assets, rather than rescuing Great British Prawns as a going concern.
Mr Bain, a restructuring director at Johnston Carmichael, said: “Unfortunately the business had already ceased to trade prior to the appointment of administrators, and the majority of employees had been placed on furlough.
“Regrettably, with no ongoing trade, all 18 jobs at the business have been lost.
“With the vast majority of demand for the company’s product coming from the hospitality industry, Covid restrictions undoubtedly had a significant impact on the business.
“The administrators are currently looking to realise value from the company’s assets.”
According to a notice of administrator’s proposals, a number of bids for the assets have been received, and the administrators are “currently considering the conditionality attached to each bid through further diligence.”
The filing shows that Resonance agreed to provide Great British Prawns with funding of up to £11.2 million during 2020 and 2021.
The purpose was to “support operating costs and commercial production at Balfron, and the
development of a new production facility in Portland, Dorset.”
The Companies House filing notes that £2m was drawn down by the business in September, with around £2.07m outstanding at the date of insolvency.
Resonance issued a demand on February 18 for the sums outstanding to be repaid.
However, when Great British Prawns and subsidiary GBF, set up in May 2020 as part of a ‘hive down’ agreement for financing reasons, were unable to pay, the companies were placed in administration.
Great British Prawns had been led by former soldier Dougie Allen, who served in the Royal Scots Dragoon Guards.
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