The company behind Southend Airport and former Eddie Stobart owner Esken has confirmed that it fell into administration on Thursday.
Esken said that administrators from AlixPartners had been appointed after it earlier in the day revealed that a potential restructuring plan was no longer “commercially viable.”
But a deal which secures the future of London Southend Airport is unlikely to be affected by the administration, the business said.
Two weeks ago Esken reached an agreement to hand over the majority stake in the airport to private equity investor Carlyle Global Infrastructure Fund.
The deal was designed to settle the airport’s £193.75 million debt to Carlyle.
At the time, Esken said that it was trying to run a restructuring plan which could take several months.
But on Thursday morning the business revealed that it would abandon this plan and appoint administrators because of concerns about the way that the law works in Guernsey, where Esken is registered.
“Further to the announcement on March 6, the company has concluded (following detailed advice from advisers) that implementation of the proposed restructuring plan in relation to the company has ceased to be commercially viable,” the company said.
It added: “Esken has therefore concluded that there is unacceptable risk associated with the court process to achieve the proposed outcome, which could also take considerable time to execute.
“Therefore, after detailed consideration of the company’s current financial situation, and absent any further viable proposals to deliver a stable solution to the challenges faced by the company, the board has now regrettably concluded that the company should be placed into administration in order to protect the interests of stakeholders.”
It confirmed the appointment of AlixPartners later in the day.
Esken used to be called Stobart Group, and was the business which owned logistics company Eddie Stobart.
But around a decade ago Stobart Group sold a majority stake in Eddie Stobart. Even after that it kept the right to the name Eddie Stobart, which it licensed out to the logistics firm.
Years later it sold the rights to the name to Eddie Stobart, which forced Stobart Group to change its name to Esken.