The telephone fundraising agency Pell & Bales has gone into liquidation with the loss of 20 full-time jobs just two months after being sold by the business processing outsourcing firm Parseq.
A statement issued today by Gerry Hoare, one of the main investors who acquired Pell & Bales and its sister telephone fundraising company Pure Fundraising from Parseq in June for an undisclosed sum, said the management team had been "forced by creditors" to place the company into liquidation.
Speaking to Third Sector this morning, Hoare said his investment in Pell & Bales had proved to be a "very big mistake".
Asked if he had acquired the company with a view to liquidating it shortly afterwards, he said there would be no point in doing this. "If you could find some value in that asset, you’d be a very good investor," he said.
The statement says: "The challenging market place has meant it just is not possible to maintain the Pell & Bales business."
It says that the Pure Fundraising will continue, having undergone extensive restructuring of its operations over the past few months.
A source close to the situation told Third Sector that more than 100 people including 86 fundraisers had lost their jobs, once zero-hours contracts were taken into account. A total of 276 were employed across the two companies in May. A spokeswoman for Hoare said she could not say how many jobs would be lost in total.
Third Sector understands that Pell & Bales’ fundraisers and operations staff first became aware that the company was in serious trouble when they received text messages yesterday telling them not to come into work. They were unable to access their emails or log in to the company’s IT system.
Other staff members received telephone calls from one of the company's investors, in which they were told they would not be paid for the month of August but could make a claim to the insolvency firm Moorfields Corporate Recovery, which would handle the liquidation process.
Third Sector’s source said that although Pure was still officially in operation and staff had not been made redundant, the agency was also expected to close within a few weeks. But a spokeswoman for Hoare strongly denied this.
She declined to say how many clients Pure had.
The source said that since Hoare acquired Pell & Bales no main person had been in charge of the company.
Scott Priestnall, a director of the Armstrong Group, an investment firm specialising in turnaround and growth investment in the leisure and entertainment and property management sectors, became the sole director of Pell & Bales on the day the company was bought by Hoare.
Asked to comment on Pell & Bales going into liquidation so soon after being sold by his company, Tony Strong, chief executive of Parseq, said: "Pell & Bales and Pure were sold as a going concern. The sale enabled Parseq to focus on its core business, which provides in-bound voice and finance and administration services for the charity sector."
Pell & Bales’ profits fell by almost 80 per cent to £267,000 in 2014, and its turnover fell by more than 30 per cent to £7m, according to its latest accounts.
The agency, which in August 2014 was the focus of a critical Channel 4 Dispatches programme on telephone fundraising, had been in a corporate voluntary arrangement since 2011, requiring it to repay more than £1.1m to its creditors. Documents filed with Companies House show that the voluntary arrangement was completed in June.
In May, Strong said that all the company’s debts would be settled in full before it was sold.
Priestnall could not be reached for comment.