STL - Stick with us
Ken Munro, new CEO of STL Distribution, has today written to STL’s trade customers to announce that “STL Distribution is back in business and working hard to return to the standard of service both suppliers and retailers have come to expect over the years.”
As well as restocking the warehouse and working to re-establish agreements with previous trading partners, the company has announced that SAP will be disbanded and the previous working system reinstated:
The transition project is already well underway and we expect to have the updated Informix platform operational within the first quarter of 2010. This is not a high risk IT project, with significant in-house knowledge and experience being brought to bear and previously robust process and technology being re-activated. Interim operational processes and IT are in place to ensure that service is minimally impacted through the transition. We will communicate the detailed IT plan in January and provide regular updates going forward.
This inevitably begs the question of why Biblica failed to take exactly this course of action a year ago; but wherever the faults lie and whatever the answer to that question, this is surely a time to celebrate and to welcome John Ritchie Ltd to their new role.
Ken Munro, I salute you!
- Read the full message on the STL Blog: A message from Ken Munro, the new CEO of STL Distribution
December 23, 2009 at 4:43 pm
Good. We seem to be getting somewhere at last. It is good to see a positive vision to grow STL Distribution. It is with great relief that the new management are going to utilise some of the existing staff. Thanks Ken, they are a great assett.
If I understand this saga correctly (some hopes)then STL (a thriving business)merged with IBS and became IBS STL. It then changed its name to Biblica and a year later Biblica sold off the whole of the UK part (causing real supply problems and disruption to all shops and many publishers). Presumably the various new parties paid good money (and probably large sums) for its different parts and I assume all this money goes to Biblica after costs (and so out of the UK).
My question is: It has been money from the UK trade over the years that has built up STL in the UK and so should some of the sale money be used by Biblica to set up some sort of fund to help further the work in the UK Christian trade.
OK, this is totally simplistic and the true story is hugely complicated (and maybe, probably, totally different)but from an outsider’s view a mutual merger and then closure of a 35 year old business seems so draining to the UK trade.
Just a thought.
December 23, 2009 at 5:48 pm
Sounds like a reasonable summary and a fair cop to me, Geoff…
December 23, 2009 at 7:16 pm
Hmm. I wonder if much of the money built up in the UK trade by STL was lost to debt and covering the cashflow over the last 12 months. I suspect there is little left in the pot after the sale has been completed, and that Bibica will be happy to have come out cash neutral.
December 23, 2009 at 9:39 pm
No, Not entirely.
While your summery seems accurate, your ultimate conclusion seems, to me at least, pretty far off the mark.
IBS-STL was only sold in any way AFTER going into administration. Even if only that way, businesses or parts of them were brought from administrators (with the possible exception of Authentic Music/Kingsway, which was more than likely a deal which saw Kingsway write off debt in exchange for the music catalogue).
I would very much doubt any cash changed hands between any of the buyers and IBS-STL (Biblica). Any cash would currently be sitting at Baker Tilley waiting to be claimed by any creditors, so if you are one of them, put your claims in now, I also seriously doubt any such deals cover all of the debts which are outstanding. There will be no fund, because the money involved is a tiny fraction of that which is currently owed to the UK Christian trade at present.
I know IBS-STL did as much as they were able to clear as much debt as possible prior to the sale, and that the majority of the debt is with banks, but there are still small businesses which will likely never see what is owed to them… unfortunately that is the nature of the beast when administrators become involved.
And while i am sure that there will be an outcry from the trade for aid from Biblica, and I know that many at Biblica, I suspect even Keith himself wish it was possible to do so, but the nature of charities that re-assigning any money is often far more difficult than anyone who has not been asked to do so will ever realise.
But anyone who thinks that Biblica has hauled in some huge cash payout would, i’m sure, be very much mistaken.
December 23, 2009 at 11:33 pm
I can only go from the limited public communications issued in the last few weeks. As far as I can see Baker Tilly were just acting for IBS-STL to sell the business (which I think I read somewhere apparently was not under any pressure from the bank)- they were not Administrators. STL’s own press release on Monday says “In each case the new owners will purchase the assets of the parts of the business; no one is taking over responsibility for the IBS-STL UK charity which regrettably will be put into Administration for an orderly wind down.”
I have had an email today dated 23rd Dec from the Quartz Partnership who appear to be the Administrators. They quote 19th of Dec as a significant date.
However, I am just an independant bookseller looking from the outside, with no knowledge of the situation.
December 30, 2009 at 1:32 am
Baker Tilley is a huge company with many parts… like Baker Tilley Corporate Finance, who were brought in to help handle negotiations, or Baker Tilley Restructuring and Recovery, who operate as Administrators and were appointed so at 4pm on the 18th.
Believe me when i say, no matter how transparent IBS-STL would like to be, these sort of firms (completely legally and above board, i might add) do muddy the waters somewhat when it comes to any of these sort of transactions.
And whatever you have heard from the Quartz Partnership, what you can be certain of is that they are NOT administrators, but rather, if legitimate at all (and i have yet to hear whether or not they are from the administrators themselves), a management and support company used by administrators to help with receiving and collections. They are contractors used by administrators, but not appointed administrators themselves.
December 24, 2009 at 12:27 am
I’m reading the same as Geoff: the correspondence I’ve seen indicates that the company was not in administration but would be put into administration if buyers could not be found: Baker Tilly were acting as Biblica’s brokers, not as Administrators. They were appointed as Administrators last weekend for the 26 branches of Wesley Owen for which buyers had either not been found or for which prospective buyers were turned away/ignored.
Keith Danby stated “We are not being forced to make this decision by any bank” here: Financial disaster hits British media player.
No doubt the truth about the sums involved (or an edited version thereof) will appear in Biblica’s financials in due course.
December 24, 2009 at 12:57 am
The company was in administration before any sale took place.
Baker Tilly are the administrators for the whole of IBS-STL UK, not just the 26 stores, which are now being”managed” by a close out firm called SKG.
December 24, 2009 at 2:09 am
Iago, Luke,
Can you please cite where your information is from, as searching the Public Records and Press Releases, and indeed formal legal letters sent to various members of the trade etc concludes the same as Geoff & Phil have said.
Administration, according to IBS-STL UK’s official paperwork to Trade Booksellers sent out today, did not occur until the 18th of December which is last Friday and therefor it apparantly looks on the surface of things as if this may have possibly been after completion of sale of STLD to Ritchie and Authentic/Wesley Owen Brand to Koorong & 6 Shops to CLC and Authentic Music to Kingsway.
It is unfortunate that given actions by other seemingly less honorable institutions in previous circumstances it nevertheless causes people to raise questions such as Geoff has done and they do become real questions and concerns people wonder about.
This is the sad reality of what has come to befall the UK Christian Retailing and Publishing Trade over the last few years.
Now don’t get me wrong and let me be quite clear about this – I am positive there is nothing untoward in this and it is just an accounting exercise.
Indeed given the actaul Press Releases from the companies in regards to these sales were all released after the 18th it could be that the actaul completion dates of these sales may actaully be post administration, though this is not in anyway made clear.
I am positive that all monies or exchanges will be used only to relieve the debts accrued and used to pay off firstly their employee’s & the UK Trade bodies & publishers that have been so drastically effected by this situation.
I am quite sure that Biblica will take nothing from this directly or indirectly, even if in apparent remission/payment of any debt as may be owed to other departments of or subsidiary holdings of Biblica.
I am sure of this because I do believe Biblica is actaully an organisation that fully upholds it’s ethical and moral responsibilities as a Christian charity & organisation to the highest degree of integrity possible, and this is in all ways and not just in a legalistic or secular manner.
I am sure that in due course, as Phil says, all will become clear in time, though there is nothing to stop those in official positions now clarifying the points and tidying away the concerns before the next set of Biblica Financials. Indeed that probably would be a most helpful and beneficial exercise to be undertaken.
December 30, 2009 at 2:16 am
Phil, Melanie.
There are documents which do confirm what I have said is true and accurate. I have seen them. If legally possible i will look into sharing them with you, though i make no guarantees that it will be.
If you want evidence however, I suggest that you go and make a credit card purchase at a Wesley Owen store currently owned by Koorong and take a look at the credit card receipt.
Then go down the road to a local “in administration store” and do the same and compare Credit Card slips.
You will notice that both say “Care of D Bailey and R Cash” on the top. The same Don Bailey and Russel S Cash of Baker TIlley Restructuring and Recovery appointed as administrators of IBS-STL UK, but no-one at all related to the team from Corporate finance who handled the discussions.
http://www.thebookseller.com/news/107408-wesley-owen-stores-enter-administration.html.rss
It would seem odd that if a store purchased by Koorong was never in the hands of the administrators that they would agree to handle Card payments in the interim.
My understanding of events is something like this:
4:00pm D Bailey and R Cash appointed administrators of IBS-STL UK and all of it’s divisions
4:02 ish (or according to paperwork I have seen, “immediately following this”) Koorong Books PTY LTD sign final paperwork to purchase their 8 stores and Authentic Publishing from the administrators. At the same sort of time CLC purchase a further 6 stores.
At the same time, Baker Tilley sign a deal agreeing to sell all stock in the remaining units to an agent who is currently trading that stock on their behalf.
Some time between 5:00pm and the following morning (after the close of play at carlisle on the 18th, but before opening the following day) John Ritchie Sign paperwork to buy Carlisle operations.
Anecdotally, this would seem to be backed up by the fact that no-one was willing or able to announce the sale before the company was already in administration. We, the staff, worked the morning after the night before, and can say with certainty that I have been much more annoyed had a sale been made before administration and kept from us. All the information i have and saw ascertains that all sales (except for authentic music, which is the one i am not sure about) happened after administrators were appointed.
I am not sure where Authentic Music falls into this, but, as i have previously speculated, was possibly deal signed before the administrator was appointed which saw IBS-STL hand over music and video rights in exchange to the writing off of some outstanding debt.
Though Russell Cash seems to have been involved with some negotiations prior placing the company in administration, given that he only works for restructuring and recovery (not corporate finance) it seems that administration was a necessary intermediary for whatever reason. My guess would be that it allowed for the sale of the assets of the business, while leaving debts to be handled by the administrators, though since i am no legal expert, it is pure speculation.
And while I agree fully that press releases could be clearer, i must say that my feeling, given my personal exchanges with people both at IBS-STL and Baker Tilley suggest that, if it is unclear, it is because Baker Tilley, not Biblica want it that way. This is not to cast any negativity upon Baker Tilley, their world is one I know nothing of. All I know is that it is they, not IBS-STL who have orchestrated everything that happened post – 4PM on the 18th
Perhaps the best course of action is to ask Baker Tilley themselves for clarification. They have certainly been accommodating to most questions I have asked of them, even though they have not been immediately forthcoming with some facts until after prompting. I guess that is the nature of administrators. As i have said, theirs is a world i know nothing of, and i am grateful for that small mercy.
December 23, 2009 at 7:24 pm
[...] A position applauded by Phil Groom at Christian Bookshop Blog. [...]
December 24, 2009 at 10:56 am
As long as creditors get their cash as many are still due payment from the SSG fiasco and two lots of bad debts in three years could bring some suppliers to their knees.
December 26, 2009 at 10:30 am
Hi Melanie, my sources inside STL need to remain private, but I trust them, and they say that the sales were post administration.
The buyers wouldn’t want to take on the debts or problems that ended STL, so the purchases would have taken place after administration.
Like you, I don’t believe that Biblica will take money out of this situation. Let’s just hope the sales raised enough money to pay off the creditors. Somehow I doubt they will, as in situations like this someone always loses out.
Although I hear that all staff were paid in December.
December 26, 2009 at 8:14 pm
Iago,
Though I am sure your unnamed sources are reliable, and I am also sure and can understand that you trust them and have good reason to.
However to be exact the buyers would not need to be doing any purchase post-administration to save off debts or problems as they were from prior to their purchase.
As it says in official releases, the purchasers were not buying any part of the business in entirety but seperate parts and assets – therefore they would not by nature of normal business practice and law be liable in anyway to the prior creditor debts which would remain, indeed clearly by the act of administration do remain, with the liable company/charity – namely in this instance IBS-STL UK whcih was itself a legally seperate but wholly owned subsidiary holding of Biblica.
So again though I am sure your sources are accurate, I personally do believe it really would be best of Biblica to make some sort of official announcement to offset any doubts as may remain with people over this concerning situation.
December 26, 2009 at 12:00 pm
There does seem to be something of a discontinuity between the official line and what’s emerging here … whatever the truth may be, one can only live in hope that that the best interests of the staff and the creditors have ultimately been served.
I can understand that Biblica may want to save face and no doubt want to put as positive a spin on things as possible, but it strikes me as very sad that not one word of this fiasco has yet appeared on their official news pages.
December 27, 2009 at 12:00 am
This report at scotsman.com seems to support the view that the entire business went into administration before the sales went through: Future still unclear for rump of Wesley Owen bookshops.
December 30, 2009 at 9:51 am
Hi Luke,
Thanks for trying to be helpful and assuage peoples concerns, it is appreciated.
However given some of the things you are reporting this actually opens the door to more question, whilst putting one to rest.
I think most had/have come to accept transactions happened post administration.
However some of what you say does still raise questions in some cases as it seems still to be a little grey (as you rightly point out much of the work of companies invovled in debt restructuring and administration is often grey to those not involved, though this does not make it any less legal for all that – indeed business and corporate law is greatly made up of shades of grey, probably because as with all law Justice within the legal systems is blind and so likely not prone to seeing colour ;0)
Given what you have said, the following intrigue me:
That both Koorong – a privately owned and traded business with the right to use the Wesley Owen name – and the previous WO shops that are now in administration both say:
‘ “Care of D Bailey and R Cash” on the top. The same Don Bailey and Russel S Cash of Baker TIlley Restructuring and Recovery’
I have to say this boggles my mind a little indeed – unless of course Koorong purchased the stores but not all the stock initially – though this seems somewhat unlikely, but not impossible.
Of course this could also have something to do with this statement you make which also greatly intrigues me:
‘At the same time, Baker Tilley sign a deal agreeing to sell all stock in the remaining units to an agent who is currently trading that stock on their behalf.’
Because at this point it would seem to be that the stock being sold in the previous WO stores that are now in administration has actaully already sold to a third party and is not therefore being traded in administration as such – though obviously from the timeline given it was initially sold by IBS-STL UK whilst in administration but to the third party who are now trading it as a private concern but through the administrated shops as such.
Therefore the money raised from the sales of these stocks would seem to be going to the third party who purchased that stock in this transaction you make mention of.
(I willingly concede that I may have the wrong end of the stick here, I am just trying to clarify some of what you have stated and this is how it is reading to me).
As I have previously said and reiterate, I am sure there is nothing at all untoward in this and it is merely and accounting exercise.
It is just unfortunate that clarity is so unforthcoming on an official level, whether that be from B&T, Biblica etc so as to assauge all these issues.
December 30, 2009 at 12:47 pm
My guess would be this.
Koorong do not have UK Bank Accounts set up yet (Even if it weren’t Christmas, international law would mean that it would take quite a bit of time) so the administrators (as previous owners of the stores in question) are handling credit card processing on behalf of Koorong in the interim. As i see it, this would only be possible if the stores did infact go into administration first, but that is all i meant by it, as some form of proof that what i said was the case. All transactions in Koorong owned stores, is between you and Koorong, with D Bailey and R Cash holding money in trust for them.
I suspect that the same is currently being done for this “agent” who has purchased all stock.
The legalities of all of this confuse me greatly, even as an insider. I trust that it is legal, but it certainly seems odd to me.
We are still under the employ of the administrators, not this “agent” but all stock is being sold on behalf of the agent.
I guess it works somewhat like a concession would operating inside of a department store. Staff can be employed by the store, even though the stock is sold on behalf of an entirely separate company.
I guess this agent owns the stock, and has an agreement to sell it in the administrators retail units, using the administrators staff and infrastructure.
I am certain it is legal, if not perhaps the best or most honorable way to proceed, as it really has thrown a spanner into the works for a number of local bidders at some stores, who had relied on being able to purchase the stock themselves.
However, I can assure you, that whatever your opinion of this practice may be, it is Baker Tilley’s decision to make, not IBS-STL/Biblica’s.
And given the number of NDAs and confidentiality agreements signed during the process, I doubt Biblica would be in a position to comment on these matters, even if they wanted to.
December 30, 2009 at 12:22 pm
Maybe some of the answers are slightly more pragmatic.
That Baker Tilly are helping Koorong by allowing them to use their credit card machines in the short term whilst Koorong sort their own banking out. The Christmas period and an Austrialian firm setting up in the UK at short notice may have made his this more difficult.
…and that the firm trading the 26 shops is doing that on behalf of the administrators, so the financial management will be down between them, hence the header on the credit card machines.
As for Biblica official announcements, maybe they have decided not to talk publically about this situation but keep things internal, their choice. A poor one I think though.
January 5, 2010 at 9:59 pm
[...] branches of Wesley Owen left out in the cold and the rest of the company parcelled out between CLC, John Ritchie Ltd, Kingsway and Koorong. Bigger, it seems, is not always better — but connected surely is, and [...]
January 22, 2010 at 2:40 pm
STL DISTRIBUTION
“Stick with us we have more to offer”
I would like to know what STL can offer creditors like myself who are owed large sums of money?
There is much talk of prayer for STL and staff but what about ministries that could be wiped out because they have not been paid for stock taken and sold by STL.
As a ministry we were Sending The Light.
January 22, 2010 at 2:51 pm
I think this is a real issue and one worth raising. Part of the problem is that STL we now have is not the same company that owes people money. That STL is in the hands of the recievers who are recovering money owed to pay out what they can. The STL we now see bought the name, the premises and employed the staff, but didn’t ‘buy’ the debt, so it would be unfair (and indeed impossible) to expect the new owners to pay the debts. If they were expected to do that they probably wouldn’t have bought the business, so things would probably be even worse than they are now!
It is a horrible situation though, and I guess we should all pray that the money owed to the old STL is all collected so that they can pay out as much of what they are owed as they can.
January 22, 2010 at 2:57 pm
The problem you’re up against, Talitha, is that the company now trading as STL is a completely new legal entity, a division of John Ritchie Ltd.
The company that owes you money was IBS-STL UK, a division of Biblica USA … and they’ve walked away, leaving IBS-STL UK in administration. Gives a whole new twist to the “What Would Jesus Do?” question…
The good news, if there is any in all of this, is that the administrators are collecting monies due from retailers for goods supplied by the old STL, which should be available to pay creditors such as yourself. I suggest you contact them as soon as possible to stake a claim.
January 22, 2010 at 3:07 pm
PS: For one example of how messy things are, see Call to Retailers for Urgent Action over STL Credits and Returns
The people you probably need to contact are the Quartz Partnership, who are collecting payments on behalf of the administrators.