Former Pindar chairman Andrew Pindar has claimed that trading practices at rival Polestar were partly to blame for the demise of the family-owned group, which owed trade creditors some £6.5m when it went into administration in July.
In an interview with the Financial Times for an article about pre-packs, Pindar claimed Polestar’s unsustainable low prices had "pretty much knackered an entire industry sector".
He said: "Many good companies have ended up failing while the bad guys have got bailed out yet again. You have to wonder how someone can go on like that [sustaining heavy losses] for such an extended period of time... dump a pension scheme and still be trading."
In response, Polestar boss Barry Hibbert told PrintWeek that he believed Pindar’s comments were "ludicrous and disingenuous".
"The fact is, Pindar lost its largest customer to a US printer who undercut them and offered new investment. Polestar weren’t even involved in that tender. The reason we attracted investment and they didn’t is that Polestar’s underlying operating cashflow and operating margins are good, Pindar’s weren’t – end of," Hibbert stated (his response in full can be read here).
Pindar’s unsecured creditors are likely to receive nothing, according to administrators at KPMG. The total amount owed by Pindar PLC, including the £6.5m owed to trade creditors, ballooned to £105.8m once a £90m debit – the theoretical value of buying out the company’s final salary pension scheme – was included, along with £4m owed to HMRC.
Paper suppliers were among the biggest losers, with the total deficit to Pindar’s major paper providers exceeding £5.2m. Sappi was the biggest single paper creditor, and was owed just under £1.6m.
Mike Gibson, managing director at Sappi UK, said: "We were the largest supplier to Pindar and they had been trading with us on normal terms. We got caught up in the middle.
"The problem is, there will be a lot of consolidation and a lot of bankruptcies in the sector. We can’t just panic and withdraw credit lines to everybody," Gibson added.
However, Tim Elliott, managing director at independent merchant Elliott Baxter, said he felt let down. "We feel we have been very seriously misled by Pindar. They gave us a very large order and assured us we would be paid. But we have to move on."
A raft of trade printing and finishing suppliers to the group have also been left holding five-figure debts.
Official documents also reveal that York Mailing acquired Pindar’s web offset business for £2.5m, of which £1.5m is a deferred consideration payable in instalments, to be completed five months after the sale. The Pindar cartography business was sold to Halstan for £22,500; and the Agility multichannel software operation was acquired by its management for £217,500. The amount paid for Pindar’s confidential print business has not yet been disclosed.
KPMG’s time costs and expenses to 7 September came to more than £885,000.
Trustees of pension scheme £90m
Robert Horne £822,055
Stora Enso £435,719
Elliott Baxter & Co £377,724
Norske Skog £278,688
Stehlin Hostag £138,268
Denmaur Independent Papers £136,256
Kodak GCG £110,246
Gould Publication Papers £97,415
Manroland GB and AG £95,318