Grim Outlook For 2e2 As Administrators Appointed

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Private equity-backed 2e2 took on too much debt which has pulled the company down

As administrators are confirmed for an ailing channel giant, a combination of reckless acquisition and lack of funding has been blamed for forcing the 2e2 Group into crisis.

According to The Register, 319 UK sales and admin staff have been laid off and their pay for last month withheld.

The administrators for the struggling service provider have been confirmed as Simon Granger, Chad Griffin and Simon Kirkhope of FTI Consulting. As joint administrators they will preside over a number of UK companies in the 2e2 Group. Meanwhile, its international businesses in Jersey, Guernsey, Ireland, Spain and Holland, which are outside the insolvency process, have been able to continue trading but will be put up for sale.

Too much debt

Formed in 2002 the group was generating £395 million in revenue by 2011 and employed 2,000 people. But its rapid organic growth was undermined by some over-ambitious acquisitions which left the company exposed to unserviceable costs.

Joint administrator Granger has promised to work with management to ensure the continued provision of business-critical services to the group’s customer base. “We are exploring options for the UK business and commenced a disposal process for the overseas subsidiaries,” he said.

One channel commentator blamed rapid buying sprees, of companies such as Compel and Morse, which led to the accumulation of unserviceable debts.

Got an outstanding invoice with any of the following? You may have to talk to the administrators

2e2 Holdings Limited
2e2 Investments Limited
2e2 Group Limited
2e2 Limited
2e2 UK Limited
2e2 Managed Operations Limited
2e2 Property Limited
Morse Overseas Holdings Limited
Morse Group Limited
Diagonal Quest Limited

 


Author: Nick Booth
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