Several buyers in talks to restart bankrupt Blokker; Retailers debts top €92 million

Bankruptcy administrators of the bankrupt retail chain Blokker are still in talks with “several” potential buyers about a restart for the company. They did not share how many parties they are speaking to in their first bankruptcy report about Blokker. The report stated that the retail chain was carrying debts of over 92 million euros.

Initially, dozens of parties were interested in a restart after Blokker's bankruptcy. This was followed by 26 parties being handed access to a virtual data room in which information about the company could be found. It is still unclear whether a restart will succeed and in what form.

Blokker went bankrupt last month after continuous losses and troubles with paying off debts at the Dutch Tax Authority. This fee is almost 26.2 million euros. These debts occurred during the Coronavirus pandemic when shops only had limited opening times as a measure to stop the virus from spreading.

It was reported in the bankruptcy report that the finance company Gordon Brothers is owed 26.7 million from Blokker. They have the lien on all movable property, so in principle, they also have the right to the proceeds from the bankruptcy sale that is currently taking place at Blokker stores.

The bankruptcy administrators reported that they have made agreements with the American financier about dividing the proceeds from the sales to keep the possibilities of a restart alive.

It is also stated in the bankruptcy report that the financing structure from Gordon Brothers contributed to a “negative spiral” that led to the bankruptcy. The amount of credit Blokker received depended on the size of the store stocks the company had. However, due to the aftermath of a conflict with a previous financier, the company had difficulty replenishing its stocks, after which the available credit from the American lender also fell.

Blokker also has debts of 66 million euros with other parties, with the Dutch Tax Authority having priority over other creditors. The total debt fee will likely be much higher. For example, the benefits agency UWV has yet to submit its claim.