Marriott & Co. Spring 2016 Newsletter
A busy start to the year for the Marriott & Co. disposal team with various online asset sales completed. The assets sold included Sheet Metal Machine Tools, Woodworking Equipment, Motor Vehicles, Audio Visual Stage Equipment, Motorbikes and Scooters, stock of Formal Menswear, a vast Model Train Collection together with a sale of a Residential House in the Dordogne. Ongoing negotiations for the sale of a solvent Property Maintenance Company continue.
Our valuation team have also been busy with some interesting valuations.
Marine Catering Equipment Manufacturer – for over 60 years from their factory in Southampton, the company manufactured Galley Catering Equipment for the Marine Industry. We offered for sale its engineering production assets by online auction, as well as its unfinished work in progress and its intangible assets including its goodwill and trading name. Our targeted marketing generated considerable interest in the assets and the resulting realisation exceeded all expectations. Following the sale and our overseeing the safe removal of the machinery we left the premises clear and tidy.
Timber Framed Buildings Manufacturer – From its vast premises in Andover this company manufactured timber framed buildings. After providing the valuation required for the liquidators our instructions were to dispose of the assets. An online auction was arranged for the joinery machinery and equipment and the strong interest obtained from our marketing ensured the assets achieved their maximum realisation.
Residential Property in the Dordogne – Our assistance provided to a retained client in finding a buyer for his French residence, proved successful late last year. Our marketing found an American couple to complete a purchase of the property. The sale compromis was signed in December and the final Acte de Vente is set for early March.
Stage Production Company – The curtain finally went down on a company which held theatrical licences for Fireman Sam and Tree Fu Tom, the popular children’s television programmes, when the company was placed into Liquidation late last year. We sold the stage production equipment and motor vehicles and ensured licenced costumes and stage props were returned to the licence holders.
Hornby and Bachmann model locomotives collection – On behalf of the Trustee in Bankruptcy we removed the vast collection from the matrimonial home. Apart from the valuable engines the collection included 1000’s of photograph albums. The albums recorded and referenced trains at various locations throughout the UK back to the early 1970’s. This comprehensive reference library has become a liability rather than an asset. Even the Bankrupt, the creator of the library, chose not to keep it! At the weigh-in at the local recycling centre the albums registered over a tonne in weight!
Menswear Company in Liquidation – In order to exit the company’s premises swiftly following a closing down sale in December we had to achieve sales of the remaining stock and fixtures & fittings from this company’s retail store and also its formal menswear hire shop in very short order. The stock was not valuable enough to warrant transport costs in uplifting and additional storage charges, so a short notice sale was arranged and completed prior to incurring any additional rent costs. The realisations exceeded our expectations thanks to some professional and targeted marketing by the disposals department.
Motorbike and Scooter Dealership – Importing and selling Chinese manufactured motorbikes and other goods, this company unfortunately ceased trading last month and we recently completed an online tender sale to realise its assets on behalf of the Liquidators. One of the reasons this sale was marketed as a tender sale rather than an online auction was that we could closely monitor the status of the buyers and ensure that the products, particularly the electric scooters and children’s quad bikes, were not sold to consumers. Even though our conditions of sale assume buyers to be purchasing in the course of their business, one can never be too careful when it comes to the safety of the general public. Further, it seems many auctioneers are not even aware of the new Consumer Distance Selling Regulations which came into effect last year meaning that consumers who have not viewed lots can technically return them within the statutory ‘cooling off period’. Although the Consumer Protection (Distance Selling) Regulations 2000 excepts “any contract concluded at auction”, this does not include online auctions as clarified by the Consumer Contracts (Information, Cancellation and Additional payments) Regulations 2013.
Goodwill Valuations – Interesting valuations completed in recent months included a retrospective statutory market valuation of an engineering firm’s assets (which were transferred from a partnership to a limited company in 2011) in accordance with the Taxation of Chargeable Gains Act 1992 definitions. The main asset under scrutiny was the company’s goodwill and so investigations needed to made in conjunction with the company’s accountant.
Another interesting recent valuation was carried out for a recruitment company specialising in the childcare sector. Again the main asset was goodwill (and intangibles) only this time the basis of valuation adopted was IVS Fair Value as defined in IVS Framework paragraphs 38 to 42 as ‘the estimated price for the transfer of an asset or liability between identified knowledgeable and willing parties that reflects the respective interests of those parties’. This basis was adopted because the assets were to be transferred in-situ to a related party, effectively as a going concern. It differs from Market Value and was appropriate in this case.
For both the above valuations, it was up to Marriott & Co. to advise our client as to correct basis of valuation at the outset. It is often the case that clients are not familiar with the correct basis and assumptions to make in order to comply with the RICS standards and any statutory requirements. That is one of the reasons why it is so essential that valuations are carried out by qualified valuers like Marriott & Co.
Should you have any requirements for asset valuation or asset disposals, then please do not hesitate to contact any of the team here.