Lawyers’ fees for advising on the administration of some of the best known high street retail stores have topped £7m in the last year, the administrators’ latest progress reports have revealed.
Total legal fees to date from the collapse of Toys R Us, House of Fraser, Poundworld, Maplin and BHS are around £7.1m. All entered administration in the last year with the exception of BHS.
US firm Jones Day and international firm DLA Piper were among the biggest recipients.
By far the largest sums went to firms advising on the administration of BHS – now known as SHB Realisations. The store chain, formerly owned by Sir Philip Green, collapsed into administration in 2016. A liquidators’ statement of receipts and payments by FRP Advisory, published last week, revealed legal bills for the year December 2017 to 2018 were more than £5m.
According to the document, £4.6m went to US firm Jones Day while international firms DLA Piper (£277,000) and Hogan Lovells (£90,101) were also among adviser firms.
A 3 January report from EY, the administrators of House of Fraser (HoF), said pre-administration costs included a payment of £384,691 to magic circle firm Clifford Chance for ‘two weeks of contingency planning’ and £6,764 to Bryan Cave Leighton Paisner. Smaller payments were also made to Northern Irish firm Tughans and Irish firm Matheson in relation to ‘property matters’.
The store, which has around 100 UK outlets, was bought by Mike Ashley’s Sports Direct in August 2018 shortly after entering administration.
A progress report into the collapse of Poundworld, published by Deloitte last month, showed ‘estimated fees’ of £550,000 to DLA Piper. The firm has so far been paid £304,959. Two payments to City firm Pinsent Masons of £15,000 and £6,700, have also been made. The discount store entered administration in June last year.
Another US firm, Kirkland & Ellis, charged £308,659 for its advice on the administration of Toys R Us. A report from insolvency practitioners Moorfields said that, as of November 2018, it had also incurred costs of £167,000 from Stephenson Harwood and £131,177 from DLA Piper. Smaller amounts are also due to insolvency firm PDT Solicitors and national firm Shoosmiths.
Legal bills for the administrators at electronics store Maplin, which entered administration in February last year, were around £100,000. Administrators PwC sought advice from Eversheds Sutherland and Irwin Mitchell.