Weak Christmas trading precipitated the collapse of Box Ltd, its administrator said as it confirmed most of its staff have been made redundant with immediate effect.
As reported by IT Channel Oxygen, the tech e-tailer appointed Kroll as administrators on Friday, less than two years after it was acquired by consumer tech buy-and-build Tactus Group.
What went wrong?
In a statement this morning, Kroll said Box Ltd’s trading operations will not continue during the administration due to its financial position. The majority of staff have been made redundant with immediate effect, it added.
“The Company has faced financial difficulties, due to peak trading over the Christmas period being below forecast expectations. This led to immediate liquidity challenges which could not be remedied in the short term,” stated Michael Lennon, Managing Director of Restructuring, Kroll.
“Unfortunately, overall trading was not strong enough for the business to continue in its present format. Our immediate priority is to provide support to all the employees impacted by the Administration.”
Founded in 1996, Box Ltd turned over £76m and employed 107 people, according to Kroll.
Its demise comes less than two years after Box Ltd was acquired by consumer tech group Tactus, which ranked 38th in IT Channel Oxygen’s freshly published Oxygen 250 report into the UK’s top IT solutions providers.
In its latest annual accounts (filed in April 2023), Tactus said it had identified “a number of issues relating to the existence and valuation of inventories Box Ltd”.
In a statement issued separately from that made by Kroll, a Tactus spokesperson said the following:
“We are extremely disappointed that we have had to take the necessary steps to place Box into administration. There is a substantial ongoing legal claim which has been issued by Tactus Group against five former directors of Box and whilst this claim is ongoing, it is inappropriate to comment further. Despite the tireless work of its talented staff, these challenges proved unsurmountable.”
An updated message on Box Ltd’s website advised customers who have not yet been received goods or services already paid for that they may be able to obtain a refund from their card issuer.
Kroll said it intends to work with a “small number of remaining employees to complete an orderly wind-down of the business”.