The Bookseller.com

17th May 2008

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The Works owes £20 million

13.03.08 Graeme Neill

Beleaguered discount chain The Works owes creditors almost £20.1m, it has emerged. In a notice filed at Companies House, administrators Kroll revealed the scale of the debt owed to almost 700 companies, including more than 200 publishers.

Illustrated non-fiction publisher Parragon Book Service is owed the largest amount at £1.2m. However, the company has credit insurance for the majority of the debt, and is in negotiations with the administrators about recovering the rest.

Other businesses owed money include HarperCollins (£427,664); Carlton Books (£305,962); Kyle Cathie (£156,098); Quercus (£58,230); Penguin (£79,011); and Columbia Marketing (£168,048), whose m.d. Nick Croydon had previously expressed an interest in the chain to Kroll. Littlehampton Book Services is owed £415,906, The Works is in debt to Macmillan Distribution for £905,067 and Riverside Books is due £108,539.

The 14-page document also revealed the chain owed almost £390,000 in council charges and more than £303,000 in unpaid water and electricity bills. Publishers and other creditors have yet to be repaid any remaining debt or recover stock as Kroll completes the administration process.

Kroll informed staff on Wednesday of 85 store closures with 450 staff being made redundant. The closures should be completed by 20th March. Peter Saville from Kroll said that the moves were a "necessary step" in selling the business.

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