That's... certainly interesting. There were rumours that Maelstrom had had a debt called in. But not by whom. It certainly explains why they were desperate for cold hard cash. I find myself somewhat puzzled as to what financial reason Wayland would have for calling the debt in, if it was being serviced at £500 a day - that's around 200 days not including interest, and surely they must have been aware that Maelstrom, by the very nature of that arrangement, weren't able to pay it off.OFFICIAL NOTICEMaelstrom Games Ltd. has ceased trading and will enter liquidation at some point over the next few months.A creditor of Maelstrom Games Ltd., Wayland Games Ltd., issued a Statutory Demand under section 123(1)(a) or 221(1)(a) of the Insolvency Act, 1986 on the 17th of October, 2012 for £99,773.61 plus costs of issuing and serving the demand.This debt was purchased from Simple Miniature Games by Wayland Games Ltd on the 1st of October, 2012 and payment of this debt was demanded in full by Wayland Games after seven days had elapsed. Unfortunately, Maelstrom Games Ltd. could not pay Wayland Games Ltd. this debt in full within those seven days.
Previous to the debt purchase, Maelstrom Games Ltd. was servicing the debt owed to Simple Miniature Games at the rate of £500 per working day, claimed by the creditor when convenient for him by charging a credit card owned by Maelstrom Games Ltd., which had been occurring since mid-June and continued to late September, the last payment being taken on the 25th. Maelstrom Games Ltd. did not cancel these payments and were not aware that this debt was being transferred.Maelstrom Games Ltd. offered to pay the debt purchased by Wayland Games Ltd. in the same manner as it had paid Simple Miniature Games, but this was not taken up by Wayland Games Ltd.Maelstrom Games Ltd. can only apologise to those customers whose orders have not been fulfilled as it is now impossible for Maelstrom Games Ltd. to fulfil them, excepting those for Mierce Miniatures products (fulfilled by Mierce Miniatures in November) and Battlefront Miniatures products (fulfilled by Maelstrom Games in partnership with Battlefront Miniatures and Maunsfeld Gaming in November), all of which will be sent by Maelstrom Games Ltd. Other customer orders for certain ranges may be fulfilled in the future and any customers whose orders can be fulfilled will be contacted by Maelstrom Games in due course.All creditors will be issued the relevant notices by the assigned Insolvency Practitioner when Maelstrom Games Ltd. enters liquidation.
I can think of at least one reason, and I'm sure you can, too. But I'm stuck thinking of many others - why else buy a debt you can't afford to then let the debtor keep servicing as before...?
For those wondering, Simple Miniatures Games are...
....specialist wargames and miniatures distributors, supplying retail shops in the UK and also Europe with superb Sci-fi and fantasy miniatures, wargames, paints, scenery carry-cases and more..... so evidently (as rumoured) the original issue was about not being able to pay their suppliers.
And shortly after I wrote the above, I found Wayland's response here. It appears that in May they offered, twice, to buy Maelstrom, and when that failed:
We therefore looked to protect our customers by looking to protect the supply chain and also ourselves (as well as any of the other independent retailers who rely on this same supply chain) from the collapse of a major retailer, and managed to purchase the main debt that Maelstrom owe, in an attempt to force a resolution, rather than allow an uncontrolled collapse and all the knock on effects that would unleash on the industry.Even more interesting.
I'm sure you're watching replies carefully here.ReplyDelete
The questions that spring to mind are:
# Did Wayland ever have any intention of allowing Maelstrom to pay back the debt other than in a single lump?
# I wonder what discount Maelstrom bought the debt at (as in, how much of their own money have they spent to get Maelstrom out of the market)?
# I wonder whether Wayland will buy Maelstrom from the liquidators?
I'm sure more will emerge; we just need to watch it carefully to see whether we would want to do business with either of these companies in the future!
I suspect the answer to your first point, reading Wayland's statement is 'no'. I'd be very interested in the answer to the second, and as for the third, and Phil's comment below? I'd buy the assets if they haven't been hived off to EotS, but I don't think I'd touch the NAME with the eleven foot pole I keep for things I won't touch with a ten foot pole.Delete
It seems they didn't have to put up much money at all - Simple Games statement says 'On the 1st October we made the difficult decision to assign the debt owed to Simple Miniature Games to Wayland Games Ltd for a nominal fee.'Delete
As the main creditor I assume Wayland Games would have the first call on any assets. That could include the brand name - so by calling the debt in they get any remaining assets and the company name for future trading?ReplyDelete
I would assume they're the main creditor - would also be interested to know what rate on the pound Wayland bought the debt at, since they must, one assumes, have known that a) they intended to call it in and b) it wasn't going to be worth much.Delete
Comments from Wayland games on DakkaDakka claimed that Maelstrom was not very good at servicing the debt to Simple Miniature Games. They said as much just before their official statement, in response to Maelstrom's statement.ReplyDelete
Besides how tempting it can be to driving a competitor out of business, it must have been galling to loose sales to a competitor who then doesn't honour those sales.