In 2006 our clients acquired a run-down garden nursery with the intention of converting it into a full fledged garden centre offering the public plants and shrubs from the Nursery plus a wide range of other products. This required substantial improvements to the site including a shop and display areas as well as mains services. Our clients had budgeted for this. What they did not plan for was the fact that it took over 12 months to get the mains supplies on-site. This led to substantial additional costs and had a very adverse effect on revenue. This in turn caused delays in planned development of the site.

By mid-2008 our clients had not only used up their own capital resources, but had started to come under pressure from their bank to reduce their borrowings. In addition they had a significant level of other creditors. At this stage they approached Business Finance Services with a request for assistance. Having taken a careful look at the overall situation we agreed with our client that, before attempting to find investors, it would be sensible to afford the business a degree of protection from existing creditors so that it could concentrate on completion of the infrastructure and growth. We therefore prepared an application for a Company Voluntary Arrangement. This was successfully submited through one of the Insolvency Practitioners with whom we have a close working relationship.

The creditor protection afforded by the CVA was so successful that the Garden Centre was able to move into a positive cash flow situation without the need for further investment.