Unsecured creditors of the shirt producer/retailer TM Lewin have suffered a loss of nearly £30 million following the company’s pre-pack administration deal in 2020. The investment firm Torque acquired TM Lewin for about £25 million in May 2020, but just a month later, the company entered administration and closed all 66 stores, leaving 600 employees without jobs. Torque cited the impact of lockdowns on the business’s viability and announced its intention to focus on an online model.

According to a report from insolvency firm Resolve, Torque, as a secured creditor with a floating charge of £28.4 million, is expected to recover approximately 79% of its investment. However, the employees are still owed £1 million in unpaid wages, holiday pay, and pension arrears. Meanwhile, unsecured creditors such as landlords and suppliers claim that they are owed £30.4 million. However, the administrator has stated that they will only receive a portion of the £600,000 available.

The financial troubles faced by TM Lewin can be attributed to multiple factors, including the company’s reliance on brick-and-mortar stores and the decline in demand for men’s tailoring and smart shirts during the pandemic. The rise of remote working significantly reduced the need for formal attire, affecting the company’s sales. This shift in consumer behavior is expected to continue as more workers adapt to a hybrid work model, dividing their time between home and the office.

Torque, representing Torque Brands, has chosen not to comment on the matter, considering it a historical issue.

In conclusion, the pre-pack administration of TM Lewin has resulted in considerable losses for unsecured creditors, underscoring the challenges faced by traditional brick-and-mortar retailers in adapting to evolving consumer preferences and the repercussions of the COVID-19 pandemic.

Useful links related to the article:
1. TM Lewin Official Website
2. Resolve Group UK