UK industrial group Warner Estate has appointed administrators from CCW Recovery Solutions after losing the support of its largest client, Aviva Investors' £460 mln Ashtenne Industrial Fund.
UK industrial group Warner Estate has appointed administrators from CCW Recovery Solutions after losing the support of its largest client, Aviva Investors' £460 mln Ashtenne Industrial Fund.
In a statement on Wednesday, cash-strapped Warner Estate said the decision to call in administrators followed a notice by Ashtenne that in the future it would pay the group's asset management fee quarterly rather than monthly as requested by the group.
Warner Estate had been reliant for some time on the support of its lenders and other stakeholders to preserve the viability of its core asset management business and the withdrawal of the Ashtenne Fund's support meant the company could no longer avoid insolvency.
'This has significant implications for the group's cash flow headroom particularly given that this asset management agreement accounts for over 90% of the group's current revenue,' the company said.
Following the appointment of administrators to Warner Estate's business, Ashtenne Industrial Fund has decided to terminate the asset management agreement with the group and enter into a contract with Hansteen Holdings.
Hansteen has agreed to take over Warner Estate's asset management business including Warner's 95 employees as well as the 5.3% equity stake in the Ashtenne Industrial Fund.