City Link’s administrators have agreed to sell some of the business’s assets to DX Group for £1.125m. The assets include cages, scanners and certain intellectual property.
Hunter Kelly, joint administrator said: “This transaction represents our first step in realising the value of City Link Limited’s assets. We will continue this process over the coming weeks, alongside conducting an orderly wind down of the company’s operations.”
Kelly, Charles King and Tom Lukic of EY’s Restructuring team were appointed joint administrators on 24th December. Kelly said at the time: “City Link Limited has incurred substantial losses over several years… The strain of these losses became too great and all but used up Better Capital’s £40m investment, which was made in 2013 and intended to help to turn around the Company. Despite the best efforts to save City Link Limited, including marketing the company for sale, it could not continue to operate as a going concern and administrators were appointed.”
Some 2,356 people were made redundant across the company’s UK sites on New Year’s Eve, after the failure of a last ditch bid for the company from an unnamed consortium.
Some 371 people have been retained by City Link to deal with the parcels that remain within the company’s network, and to assist in winding down its operations. Today, 6th January, is expected to be the last day that City Link depots will be open for companies and individuals to collect parcels.
Petar Cvetkovic, chief executive of DX, said: “It is very sad that City Link has been unable to continue as a going concern, particularly for its employees and contractors. The administrators are now proceeding with an orderly sale of assets and we have made a limited investment to acquire certain assets. We are also doing all we can to provide opportunities for former City Link employees and contractors and to offer solutions to customers who may need a new carrier.”