European Home Retail
Encyclopedia
European Home Retail plc (EHR) was a listed UK company, operating in home retail. Though registered in Swindon
, Wiltshire
, its head office was based in Warmley
, Bristol
. On 13 October 2006, it was announced EHR and its subsidiary Farepak had gone into administration.
was appointed managing director of the small Christmas
savings club with 500 agents operating from a butcher
's shop in Peckham
.
In 1995 Farepak purchased the older Kleeneze
Homecare business from Arcadia Group plc, and changed its name to Kleeneze plc, hiving off its original business to a subsidiary Farepak Food and Gifts Ltd. By 2006 Kleeneze plc changed its name once more to European Home Retail plc. Kleeneze is a multi-level marketing
company, which was formed in 1923.
In due course the liquidators will establish whether the money collected by Farepak from shoppers saving for Christmas was (or should have been) held in trust for the savers, or whether the savings were general funds available to Farepak and its parent company to be used in discharge of bank loans. The liquidators will also establish whether EHR was already insolvent at the time it removed savers' funds from Farepak.
A fund was set up to help families affected by the Farepak closure. Donations have been made by companies including Tesco
, BSkyB, Sainsbury's and Marks and Spencer. HBOS
also made a donation, raising criticism that it could have given much more help by extending EHR's debt. The fund was officially closed on 29 November 2006. In December 2006, Myleene Klass
used eBay
to auction off the bikini
which she wore during her appearance on TV show I'm a Celebrity... Get Me Out of Here!, raising £7,000 for the Farepak victims.
As a knock-on effect Amtrak
, the group's main delivery agent, went into administration early in 2007.
Farepak moved from administration to liquidation on 4 October 2007.
The insolvency service has applied for disqualification of the directors
Nicholas Gilodi-Johnson was appointed after the death of his father Bob Johnson.
, a 50/50 joint venture with JML Direct, broadcasting on Sky digital channel 657.
, Wiltshire
, England
. Its own annual turnover of £70m (2004), was mainly generated from its core business in Christmas
hampers. In addition, Farepak sold High Street (and other) Gift Vouchers and also supplied gifts, including electricals. Unlike many of the other subsidiary companies, Farepak was not sold to the Findel group. There was a five hour protest outside the company's gates on 17 October 2006.
Swindon
Swindon is a large town within the borough of Swindon and ceremonial county of Wiltshire, in South West England. It is midway between Bristol, west and Reading, east. London is east...
, Wiltshire
Wiltshire
Wiltshire is a ceremonial county in South West England. It is landlocked and borders the counties of Dorset, Somerset, Hampshire, Gloucestershire, Oxfordshire and Berkshire. It contains the unitary authority of Swindon and covers...
, its head office was based in Warmley
Warmley
Warmley is a village in South Gloucestershire, England, to the east of Kingswood on the outskirts of Bristol.In the mid 18th century it contained the Warmley Works of William Champion...
, Bristol
Bristol
Bristol is a city, unitary authority area and ceremonial county in South West England, with an estimated population of 433,100 for the unitary authority in 2009, and a surrounding Larger Urban Zone with an estimated 1,070,000 residents in 2007...
. On 13 October 2006, it was announced EHR and its subsidiary Farepak had gone into administration.
History
The origins of Farepak Hampers date back to 1935. In 1969, Bob JohnsonBob Johnson (butcher)
Robert Alan Johnson was an English businessman in the meat industry. He was chairman of Farepak.-Early and private life:...
was appointed managing director of the small Christmas
Christmas
Christmas or Christmas Day is an annual holiday generally celebrated on December 25 by billions of people around the world. It is a Christian feast that commemorates the birth of Jesus Christ, liturgically closing the Advent season and initiating the season of Christmastide, which lasts twelve days...
savings club with 500 agents operating from a butcher
Butcher
A butcher is a person who may slaughter animals, dress their flesh, sell their meat or any combination of these three tasks. They may prepare standard cuts of meat, poultry, fish and shellfish for sale in retail or wholesale food establishments...
's shop in Peckham
Peckham
Peckham is a district in south London, England, located in the London Borough of Southwark. It is situated south-east of Charing Cross. The area is identified in the London Plan as one of 35 major centres in Greater London...
.
In 1995 Farepak purchased the older Kleeneze
Kleeneze
Kleeneze Homecare is a multi-level marketing company, and was started in 1923, in Hanham, Bristol, England. The founder, Harry Crook, had emigrated to America with his family several years earlier and while there joined Fuller Brush as a sales representative. He returned to Bristol several years...
Homecare business from Arcadia Group plc, and changed its name to Kleeneze plc, hiving off its original business to a subsidiary Farepak Food and Gifts Ltd. By 2006 Kleeneze plc changed its name once more to European Home Retail plc. Kleeneze is a multi-level marketing
Multi-level marketing
Multi-level marketing is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of others they recruit, creating a downline of distributors and a hierarchy of multiple levels of compensation...
company, which was formed in 1923.
Farepak collapse
After a series of profit warnings starting in June 2006, Farepak ceased trading on 13 October 2006, leaving tens of thousands of people out of pocket for Christmas 2006. EHR itself went into administration later that day. The administrators explained that Farepak's collapse was triggered by the fact £33m it lent to its parent company EHR was not paid back.In due course the liquidators will establish whether the money collected by Farepak from shoppers saving for Christmas was (or should have been) held in trust for the savers, or whether the savings were general funds available to Farepak and its parent company to be used in discharge of bank loans. The liquidators will also establish whether EHR was already insolvent at the time it removed savers' funds from Farepak.
A fund was set up to help families affected by the Farepak closure. Donations have been made by companies including Tesco
Tesco
Tesco plc is a global grocery and general merchandise retailer headquartered in Cheshunt, United Kingdom. It is the third-largest retailer in the world measured by revenues and the second-largest measured by profits...
, BSkyB, Sainsbury's and Marks and Spencer. HBOS
HBOS
HBOS plc is a banking and insurance company in the United Kingdom, a wholly owned subsidiary of the Lloyds Banking Group having been taken over in January 2009...
also made a donation, raising criticism that it could have given much more help by extending EHR's debt. The fund was officially closed on 29 November 2006. In December 2006, Myleene Klass
Myleene Klass
Myleene Angela Quinn is an English singer, pianist, media personality and occasional model. She was formerly a member of the defunct British pop band Hear'Say.-Early life:...
used eBay
EBay
eBay Inc. is an American internet consumer-to-consumer corporation that manages eBay.com, an online auction and shopping website in which people and businesses buy and sell a broad variety of goods and services worldwide...
to auction off the bikini
Bikini
The bikini is typically a women's two-piece swimsuit. One part of the attire covers the breasts and the other part covers the crotch and part of or the entire buttocks, leaving an uncovered area between the two. Merriam–Webster describes the bikini as "a woman's scanty two-piece bathing suit" or "a...
which she wore during her appearance on TV show I'm a Celebrity... Get Me Out of Here!, raising £7,000 for the Farepak victims.
As a knock-on effect Amtrak
Amtrak (parcel delivery company)
Amtrak Express Parcels was a parcel delivery company in the United Kingdom.It was founded in 1987 by Roger and Elaine Baines who grew the business from a small outfit based in the West Midlands into a nationwide parcel carrier, with around 1,000 vehicles operating out of around 100 distribution...
, the group's main delivery agent, went into administration early in 2007.
Farepak moved from administration to liquidation on 4 October 2007.
The insolvency service has applied for disqualification of the directors
Board of directors
- Chairman: Sir Clive Thompson (formerly of Rentokil)
- William RollasonWilliam RollasonWilliam Rollason was the Chairman of the Direct Selling Association in London.Rollason trained in corporate finance at Hambros Bank . Hambros was taken over by Société Générale. Before joining EHR Rollason was Finance Director of National Express which he reportedly left in 2002 after a clash...
- Chief Executive Officer (CEO) - Stevan Fowler - Finance Director and Company Secretary (appointed 1 January 2006)
- Nicholas Gilodi-Johnson - Non-Executive Director
- Neil Gillis - Independent Non-executive Director
- Paul Munn - Independent Non-executive Director
- Michael Johns - Independent Non-executive Director appointed 28 September 2005)
Nicholas Gilodi-Johnson was appointed after the death of his father Bob Johnson.
Subsidiary companies
EHR was the parent company for a number of well-known subsidiary companies, namely:eeZee TV
In March 2005, EHR formed the joint venture satellite TV station eeZee TVEeZee tv
eeZee tv was a live British shopping channel broadcasting on Sky Digital. The channel launched on 1 March 2005.-History:In September 2004, it was first announced that JML and Kleeneze were going to team up and launch a new channel, under the name of eeZee tv, which was going to replace JML's own...
, a 50/50 joint venture with JML Direct, broadcasting on Sky digital channel 657.
Farepak Food & Gifts Limited
Farepak had been operating since 1981 at a site in SwindonSwindon
Swindon is a large town within the borough of Swindon and ceremonial county of Wiltshire, in South West England. It is midway between Bristol, west and Reading, east. London is east...
, Wiltshire
Wiltshire
Wiltshire is a ceremonial county in South West England. It is landlocked and borders the counties of Dorset, Somerset, Hampshire, Gloucestershire, Oxfordshire and Berkshire. It contains the unitary authority of Swindon and covers...
, England
England
England is a country that is part of the United Kingdom. It shares land borders with Scotland to the north and Wales to the west; the Irish Sea is to the north west, the Celtic Sea to the south west, with the North Sea to the east and the English Channel to the south separating it from continental...
. Its own annual turnover of £70m (2004), was mainly generated from its core business in Christmas
Christmas
Christmas or Christmas Day is an annual holiday generally celebrated on December 25 by billions of people around the world. It is a Christian feast that commemorates the birth of Jesus Christ, liturgically closing the Advent season and initiating the season of Christmastide, which lasts twelve days...
hampers. In addition, Farepak sold High Street (and other) Gift Vouchers and also supplied gifts, including electricals. Unlike many of the other subsidiary companies, Farepak was not sold to the Findel group. There was a five hour protest outside the company's gates on 17 October 2006.
Stock Market
"European Home Retail" was listed on the stock exchange under ticker code EHR.L. 2005 group turnover was £176.2m.See also
- Administrative receivership
- BankruptcyBankruptcyBankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
- Corporate scandalCorporate scandalA corporate scandal is a scandal involving allegations of unethical behavior by people acting within or on behalf of a corporation. A corporate scandal sometimes involves accounting fraud of some sort...
- CreditorCreditorA creditor is a party that has a claim to the services of a second party. It is a person or institution to whom money is owed. The first party, in general, has provided some property or service to the second party under the assumption that the second party will return an equivalent property or...
- Department of Trade and Industry
- LiquidationLiquidationIn law, liquidation is the process by which a company is brought to an end, and the assets and property of the company redistributed. Liquidation is also sometimes referred to as winding-up or dissolution, although dissolution technically refers to the last stage of liquidation...
- Ring fence
General
- Kleeneze company website
- Farepak Website
- Direct Selling Association
- Farepak Hampers Carmarthenshire County Council
- How Farepak Stole Christmas Unfairpak Forum
- Western Daily Press - Fair Play for the Farepak Families Western Daily Press Farepak Christmas Appeal
BBC
- Farepak families fund is launched BBC News, 7 November 2006
- Factsheets: Trading Standards info on Farepak BBC Oxford, 17 October 2006
- New bid to help Farepak families BBC News, 19 October 2006
- MPs call for FTSE Farepak pledge BBC News, 23 November 2006
- Farepak response fund due to shut BBC News, 29 November 2006
- Hampers for some Farepak victims BBC News, 7 December 2006
Swindon Advertiser
- Farepak Fiasco special section contains numerous articles
- Farepak victims' plight is taken up by Government Swindon Advertister, 20 October 2006
- We'll keep up the pressure on Farepak Swindon Advertister, 23 October 2006
- Top level probe ordered into Farepak fiasco Swindon Advertister, 25 October 2006
- Farepak boss: 'I am so sorry' Swindon Advertister, 12 November 2006
- Please play Santa to Farepak customers Swindon Advertister, 23 November 2006
- TV documentary shows Farepak families still want answers Swindon Advertister, 5 December 2006
Other
- Halifax faces boycott over Christmas hamper crash The Observer, 5 November 2006