Page 16 - Auditors Article

Table 2: Patisserie Valerie Route to Disposal

The initial reaction to Patisserie Holdings’ problems,
its insolvency was for Luke Johnson to bail it out,

temporarily by an injection of funds. But, the

blackhole was too great and becoming greater as

more information was uncovered.

At the same time as the Administrators were

appointed Patisserie Holdings was initially granted a
standstill of its banking facilities thereby protecting

it from action to recover debts, and announced it

was in talks with its lenders to extend the time

period of the agreement.

A Company Voluntary Arrangement is put in
place

If the company is viable but has current or historical

problems that have been solved, this option freezes

all current debt, allowing time to pay it back. The
company can continue trading with the same

suppliers and company name. Typically, these

arrangements last for 3 to 5 years, interest is frozen

and not all the debt is paid back.