Three former directors of disgraced meat wholesaler Russell Hume, which collapsed earlier this year amid an FSA investigation into food safety failings, have acquired catering butcher Nigel Fredericks, The Grocer can reveal.
Nigel Fredericks Ltd fell into administration last month and was subsequently acquired by Nigel Fredericks Trading, a newly formed company owned and operated by former Russell Hume directors David Holding, Patrick Herlihy and Pirtpal Purewal, on 7 September, according to documents filed on Companies House.
Confirming the acquisition, Patrick Herlihy - who was previously MD of Russell Hume - told The Grocer that suppliers and customers had been “very supportive”.
“We are delighted to have secured more than 260 full time jobs at the five units in Colindale, and at the second site in the Midlands,” he said. “With the current management, fresh ideas and the longstanding reputation and experiences of the new management team coming to Nigel Fredericks, we hope to move from strength to strength.”
All existing staff were transferred as part of the deal, which also included a six month licence to occupy the catering butcher’s existing premises while leases are arranged with the landlords.
According to a report by PwC, Nigel Fredericks Ltd fell into financial difficulties after suffering a “fall in profitability and cash generation” following the drop in sterling after the Brexit vote, which increased the cost of imported meat.
The administrator explored the possibility of a sale of the company’s shares but “unfortunately this did not result in any acceptable bids”, so the only viable alternative was the “sale of the business and assets on an accelerated timescale”, it said.
The new management team added it was “very grateful” to the employees of Nigel Fredericks for their “hard work, dedication, honesty and integrity” through “very difficult” circumstances.
“Without the support of this fabulous group of talented employees the new company would not now be in a position to enhance on the reputation, quality and relationships which were built over such a long period of time by Nigel Fredericks Limited,” added Herlihy.
It comes as the FSA investigation into Russell Hume continues. The meat wholesaler fell into administration in February after the regulator uncovered what was described as “significant and systemic” failures in the company’s food safety management systems, prompting major pub and restaurant chains including Wetherspoons to pull its meat off their menus.
A report by Russell Hume’s administrator KPMG last month revealed more than £8m-worth of stock was subsequently destroyed because it either had “inadequate traceability information”, “insufficient temperature records”, was “beyond its useful life” or was “out of condition”.
While stressing KPMG had not “received any substantive update as to its progress, or the nature or extent” of the FSA’s ongoing investigation into potential criminal activity at Russell Hume, the report warned meat disposal costs were expected to rise once the probe was completed, as the regulator still held a large proportion of stock “under detention”.
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