Safestyle UK directors will ‘likely’ place the firm into liquidation after the retailer collapsed into administration earlier this week.
The Bradford-based company told investors that liquidation is likely to be required following the appointment of administrators, which under City rules leaves the group defined as ‘an AIM Rule 15 cash shell’.
This means Safestyle UK, which was once Britain’s leading doors and windows company, is now defined an investment company with six months to make an acquisition.
However, the group is not looking into any deals.
The Bradford-based company revealed in a trading update that liquidation is ‘likely to be required’
In a statement, the group said: ‘As an AIM Rule 15 Cash Shell, Safestyle is required to make an acquisition, or acquisitions, which constitutes a reverse takeover under AIM Rule 14 or seek to become an investing company pursuant to AIM Rule 8 within six months from 30 October 2023, failing which its shares will remain suspended.
‘Given the liquidation process which is now expected to commence, Safestyle is not currently pursuing such a transaction and it is therefore anticipated that once liquidators have been appointed, the admission to trading on AIM of the Company’s ordinary shares will be cancelled.’
Earlier this week, Safestyle revealed that approximately 680 employees have lost their jobs after the business fell into administration.
The group has struggled with a slowdown across the UK housing market caused largely by mortgage rate hikes, inflationary pressures and subdued consumer confidence.
Over the summer, trading was further impacted by very wet weather in July, followed by unseasonally warm weather during late August and early September.
In October, Safestyle warned that it could violate its debt covenant should losses be worse than anticipated.
Prior to the suspension of its shares, it had plummeted by around 99 per cent since the start of the year.
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