Outside VC outfit to buy Schwinn/GT UK

A spokesman from Kroll Buchler Phillips, the administrative receiver running the UK company which went pop on 1st March, said:

"The party interested in the business is not looking to make a quick buck and then get out. It wants to purchase the company and then develop it.

"The sale should have gone through some time ago. We’re not holding it up, and nor is the interested party. There are some side issues that need to be resolved."

The Schwinn/GT Europe Ltd creditor’s meeting to be held on 29th May in London still goes ahead.

The administrative receivers report sent to all creditors reports that Schwinn/GT Europe failed because the company’s stock levels were too high; its head office premises were restructured, splitting the finance and sales teams; the transport contract with IEC drained company resources; and the UK operation was forced to adopt the parent company’s software system leading to a costly phone link to the US.

In 1999 the company lost £2.6m. In 2000 the losses had risen to £6m.

It is believed negotiations are taking place in America to sell the whole of Schwinn/GT. This was thought to include Schwinn/GT Europe Ltd but this now looks unlikely and the outside VC outfit would be buying distribution rights to branded bicycles owned by a company in serious flux.