Three-week court hearing into Store First begins

A winding-up petition launched by the Insolvency Service against unregulated store pod investment scheme Store First begins in the Manchester arm of the High Court today.

According to the Telegraph, the court session is due to last three weeks.

At the end, the court will decide whether Store First should be allowed to continue operating or whether it should be wound up and any assets distributed to its creditors.

The Telegraph goes on to say:

Separately, Store First’s sister company has doubled the cash it has set aside to help customers who bought into airport parking scheme investments from £62m to £124m.

This is an over-generous reading of Group First’s accounts. As covered here last week, while Group First has made a provision in its accounts covering its liabilities in respect of the shut down of Park First, this is not the same thing as “setting cash aside”. Most non-accountants would take this to mean putting actual cash somewhere, to not be touched until it’s paid out.

Group First’s accounts reveal that its total assets are, as at June 2018, £32.4 million short of the amount required to pay off its total liabilities. It has nowhere near enough cash to set £124 million worth of it aside.

This does not mean Group First is bust, because Group First may yet make enough money from its business or realise enough from its assets to pay all its creditors back, including Park First investors. However, what is clear from its published accounts is that it does not have £124m worth of cash waiting to be paid out to Park First investors.

Meanwhile, Store First’s position will become clearer over the next few weeks.

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