Woolworths (UK) main banks get repaid in full

Unsecured creditors to Woolworths will receive almost nothing from its administration, while the variety retailer's main lending banks are likely to recoup all the money they are owed. They will receive around GBP335 million (USD498.38 million). Deloitte, the administrator, also said it has been asked by a creditor to investigate why Woolworths did not stop trading earlier, in order to give it more time to secure Woolworths successful sale before it collapsed into administration on 27 November 2008. The revelations from Deloitte followed a creditors' meeting, which was attended by 40 creditors for Entertainment UK, the group's wholesale entertainment arm, and 50 for Woolworths' retail division. Neville Kahn, the Joint Administrator and Partner at Deloitte, said the six senior lenders to Woolworths - which include the Bank of Ireland's subsidiary Burdale Financial and the private equity-owned GMAC Commercial - will be "paid in full". Once senior lenders have been repaid, a second-tier of creditors, including two unnamed hedge funds, could receive GBP37 million (USD55.04 million), while pension fund trustees could be repaid GBP63 million (USD93.72 million). Kahn added that it was "highly unlikely" that unsecured creditors, including suppliers and about 30,000 employees, will receive any money. The total amount of unsecured debt in the EUK and Woolworths' retail division that will not be repaid is GBP1.1 billion (USD1.64 billion).

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