The collapsed delivery group City Link saw a flurry of directors departing in the six months before its collapse on Christmas Eve. One, David Coles, quit on 3 December.
Mr Coles, whose online CV describes him as a former DHL UK managing director, was only appointed to parent company Becap City Link (UK) in February. His departure appears in filings at the Channel Islands Securities Exchange.
There have been concerns among some of the 1,000 or so self-employed drivers over how much the directors knew about City Link’s likely administration in the weeks running up to the collapse. Many are owed large sums for work carried out with the company in the busy pre-Christmas period, particularly those owning several vans who sub-contracted City Link work out to other drivers.
One contacted The Independent yesterday to say: “If we’d known sooner, we could have tried to get work with other companies, instead of being left owed thousands.”
Self-employed drivers are not expected to recoup much more than 1p for every £1 owed.
There is no suggestion of wrongdoing by the directors of the company, whose main creditor is a fund run by Better Capital, the private equity firm. But administrators at the accountancy firm EY said: “The administrators will investigate the directors’ conduct in due course.”
City Link directors set up a separate company on 9 December to take on the assets if they decided to put it through a company voluntary arrangement – where creditors agree to allow a company to delay payments. This plan was not carried out.
Mr Coles’ exit followed those of other directors since May – Daniel Dayan, Mark Aldridge, Nick Sanders and Peter Williamson. Mr Dayan and Mr Williamson also left Better Capital.
The private equity firm decided not to continue investing in the group on 22 December, but the insolvency was not declared for another two days – days in which drivers worked long hours delivering Christmas parcels.
EY said: “Once the directors knew on 22 December 2014 that insolvent liquidation could not be avoided, they had to minimise the loss to the general body of creditors. An insolvency on 24 December ... minimised the disruption and claims against the company, and enabled creditors to be paid during that week, which would not have happened if the company had gone into administration sooner.”
John Lewis switches
The managing director of John Lewis, Andy Street, spoke of his disappointment at the demise of City Link for the first time yesterday.
John Lewis was one of the collapsed courier firm’s biggest customers. “City Link have been a good partner of ours for many years. It was regrettable.” He said John Lewis had switched to new courier firms – DPD and Hermes – on Boxing Day, to continue serving its online customers.
Meanwhile, sales figures for the week ending 27 December fell back 1.4 per cent because shoppers splurged the week before on Black Friday.Reuse content