Accounting firm AlixPartners, overseeing the administration of BrewDog following its collapse earlier this year, has announced that creditors holding approximately £190m in claims will not be paid in full. The firm cited inadequate funds available from asset liquidation and increased expenses related to removing unauthorized occupants from closed bar locations, as well as the poor condition and age of recovered assets such as vehicles.
The UK government ranks among those designated as preferential creditors who will not receive complete reimbursement. While £489,000 in outstanding wages and holiday pay owed to staff members was covered through the government’s redundancy payment scheme, there are insufficient resources to repay the government itself or to cover £2.4m in taxes owed to HM Revenue and Customs, though a separate £3.6m tax debt to HMRC will be settled. Unsecured creditors, comprising numerous British organizations including Lord’s Cricket Ground, West Ham United FC, and Manchester University, are expected to recover less than a penny per pound owed.
Private equity investor TSG, which purchased a 22 percent stake for £213m in 2017, will see its investment entirely eliminated without recovering nearly £28m in outstanding debts. Lender HSBC is projected to recover approximately £42m of the £61m owed to it. The company’s brand, intellectual property, UK breweries, and 11 bars were acquired by US cannabis and drinks company Tilray for approximately £33m in a rescue transaction agreed upon following the administration filing. This transaction excluded most of BrewDog’s bar chain, resulting in 38 locations closing and 440 employees losing their jobs.
The collapse rendered worthless the investments of 200,000 small investors who participated in crowdfunding the business through equity offerings. Co-founder James Watt has since launched a new beer business called Second Best and has offered former BrewDog investors complimentary shares in the venture. However, multiple recipients of share offers have filed complaints with the Information Commissioner’s Office regarding potential unauthorized acquisition of their contact information, allegations which Watt has disputed.
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