The investments of BrewDog’s 200,000 ‘equity punks’ are now worthless. Photograph: Islandstock/AlamyView image in fullscreenThe investments of BrewDog’s 200,000 ‘equity punks’ are now worthless. Photograph: Islandstock/AlamyBrewDog creditors owed £190m will not be paid in full, say administratorsThere are ‘insufficient funds’ to pay unpaid wages, tax owed to HMRC and overdue bills, accountants say
Accountants picking over the remains of BrewDog, the “punk” beer company that collapsed earlier this year, have said that creditors who are owed about £190m will not be paid back.
In an update on their progress, administrators at AlixPartners warned there were “insufficient funds” to pay debts in full related to unpaid wages, tax owed to HM Revenue and Customs, and overdue bills from other businesses.
Earlier this year, the US cannabis and drinks company Tilray snapped up BrewDog’s brand, intellectual property, UK breweries and 11 bars in a rescue deal for about £33m, agreed after the brewer fell into administration.
But the deal in March did not includemost of BrewDog’s chain of bars, with 38 closing and 440 staff losing their jobs.
The collapse rendered worthless the investments of 200,000 “equity punks”, the small investors who crowdfunded the business.
AlixPartners admitted on Thursday that creditors owed more than £190m were also unlikely to get their money back.
It cited increased costs owing to “unauthorised occupiers” having to be removed from BrewDog’s shuttered bars and the limited sums recovered from the sale of assets, such as vehicles of “old age and varying roadworthiness”.
Supposedly “preferential” creditors of the bars business who will not get their money back in full include the UK government.
View image in fullscreenThe US cannabis and drinks firm Tilray snapped up BrewDog’s brand, intellectual property, UK breweries and 11 bars in a rescue deal for about £33m earlier this year. Photograph: Murdo MacLeod/The GuardianStaff who were owed £489,000 in wages and holiday pay have already been compensated under the government’s redundancy payment scheme.
But AlixPartners said there were not enough funds to repay the government, or to pay £2.4m in taxes owed to HM Revenue and Customs. However, a separate sum of £3.6m owed to HMRC will be paid back.
Unsecured creditors, including a host of British businesses such as Lord’s Cricket Ground, West Ham United FC and Manchester University, will receive less than a penny in the pound.
Private equity investor TSG, which bought a 22% stake for £213m in 2017, had its investment wiped out and will not recoup debts of nearly £28m.
Lender HSBC is expected to recover about £42m of about £61m it is owed.
James Watt, who co-founded BrewDog with friend Martin Dickie in 2007, has previously said that he was left “heartbroken” by the brewer’s collapse.
Watt’s tenure at BrewDog was marked by controversies, including criticism for the dubious taste of marketing stunts and an allegedly “toxic” working culture, for which he apologised.
He has since set up several new businesses, including Social Tip, which pays people to make social media posts about brands.
After being rebuffed in a bid to buy BrewDog back, he also launched a new beer business, Second Best, and has offered former BrewDog investors free shares in the business.
However, multiple people who received offers of shares complained to the Information Commissioner’s Office, which regulates data privacy, saying they were concerned Watt had not obtained their contact details legally.
