Brewdog's unpaid workers to receive nothing after takeover deal
Administrators say about £489,000 was owed for staff wages and holiday pay and £2.4m was owed to HMRC for unpaid VAT.
**Brewdog's unpaid workers to receive nothing after takeover deal**
Aberdeenshire-based Brewdog had more than £500m of debts when it was sold
Former Brewdog employees and several creditors of the collapsed Scottish beer giant are not expected to receive any money from the administration process.
A report by administrators AlixPartners said there were "insufficient funds" to make payments to those owed money by Brewdog's retail arm.
The Aberdeenshire-based brewer had more than £500m of debts when it was sold in March to US drinks firm Tilray in a £33m rescue deal.
Administrators said around £489,000 was owed in staff wages and accrued holiday pay. Another £2.4m was owed to HMRC for unpaid VAT.
BrewDog's takeover saw 38 bars close across the UK and
£20m in unpaid bills left to hundreds of UK businesses
Unpaid businesses included coffee shops, bakeries and laundry services, as well as lawyers, councils and holiday parks.
Creditors included West Ham United FC, Lord's Cricket Ground and Manchester University.
AlixPartners said there were now "insufficient funds" to repay preferential creditors.
It said this was because less money than expected was raised through sales of Brewdog assets, while administration costs were higher than anticipated.
The administrators pointed to unexpected costs linked to securing closed Brewdog pubs after a number of "unauthorised occupiers" entered them.
AlixPartners said it worked with landlords and lawyers to remove them.
The report highlights small sums raised through asset sales.
A 7.8 acre field in Potterton, Aberdeenshire, sold to a local farmer for £41,300
Nine Brewdog vehicles of "old age and varying roadworthiness" brought in only £6,250 from a single sale. The rest were abandoned.
A settlement involving drinks equipment sold to Marylebone Cricket Club, which owns Lords, generated £62,000.
Parent company BrewDog PLC is still expected to pay its preferential creditor, HMRC, in full for £3.66m in tax owed - mainly VAT and excise duty.
Brewdog's largest debt was to financial services group HSBC, which was owed more than £61m across various banking arms.
It has recovered tens of millions of pounds, but still faces an estimated shortfall of £16.8m.
The report said this could be reduced through asset sales in the United States.
Private equity backer TSG, which took a 22% stake in the brewer in 2017, is set to lose £27.6m.
Brewdog also owes about £190m to unsecured creditors. They are expected to receive less than a penny in the pound of what they are owed.
Brewdog's collapse brought the immediate closure of 38 UK pubs
In March 440 staff were made redundant and 736 employees transferred to Tilray, after the US firm bought Brewdog's brand and UK operation.
Eleven bars were kept as part of the sale while 38 other pubs closed immediately.
Former staff can claim unpaid wages through the UK government's Insolvency Service.
AlixPartners said workers had been given information about this support.
Brewdog's collapse also made the shares of about 200,000 crowdfunding investors worthless.
Earlier this year, Alixpartners confirmed that investors in the Equity for Punks scheme would get no return on their shares.
Investors typically spent about £500 on shares - although others invested much larger sums - in return for a stake in the company, discounts and perks.
The administrators said these shares now had "no value".
Brewdog, which was founded in 2007 by friends James Watt and Martin Dickie, had four breweries and about 100 pubs across the world at its peak.
Watt said he was "heartbroken" after the collapse and apologised to staff and investors.
Brewdog's owner Tilray has been approached for comment.