UK-based PC manufacturer Rock has just announced that it has gone into administration, in a statement released on its website. Financial management firm Deloitte & Touche LLP has been appointed to oversee this process and attempt to secure a sale of the company. The news comes completely out of the blue - there has been no indication from Rock before now that there were any problems.
Rock is attributing the reason for its failure at least partly to "the cash flow difficulties faced as a result of stock misappropriation by a former employee. This led to suppliers reducing credit limits, further adversely impacting upon cash flows. As a result of the recent difficulties faced by Rock in obtaining regular supplies of key components, Rock had effectively ceased to trade prior to the Administrators appointment".
The administrators have laid-off most of Rock's staff, keeping only "a skeleton staff whilst attempts are made to achieve an early sale of the business and assets as a going concern".
The important things to know at this point are thus: you can't buy a notebook from Rock at this moment and any existing orders and warranties are, for the time being, not being processed.
Rock's advice at the moment is as follows:
If a going concern sale is achieved
If a sale of the business and assets as a going concern is achieved, a purchaser of the business is likely to wish to fulfil outstanding sales orders, recommence service activities and complete warranty work.
If a going concern sale is not achievable
Should it not be possible to achieve a going concern sale of the business and assets the business will close. Rock will be unable to fulfil outstanding orders and current and future service and warranty work. In this eventuality :
*Should you have recently ordered and paid for equipment that has not been supplied, you will rank as an unsecured creditor. If your payment was made by credit card, you may be able to obtain a refund from your credit card issuer.
*In relation to warranty work, we understand that Rock maintained an insurance policy to cover the extended period of the warranty (years two and three following purchase). This policy did not cover warranty work arising in the first year following sale.
* In relation to the insurance backed period of the warranty (years two and three) we are currently liaising with the insurance company for confirmation of how they wish to handle claims arising.
* In relation to claims arising in the first year of the warranty, any claim / costs incurred represents an unsecured claim. If the equipment was purchased by credit card, it may be possible to obtain reimbursement from your credit card issuer."