Post offices hit in MBI collapse

Europe’s leading post offices head a £10m ( t10.6m) creditors’ list after the collapse in March of wholesaler and lettershop services provider Mail Brokers International.
And there may be more pain to come after holding company MBI Logistics followed Mail Brokers into liquidation last month.

Royal Mail, Parcelforce, Deutsche Post, La Poste, Swisspost and UPS are all owed six-figure sums. But a former MBI member of staff – one of 60 who received no salary or severance pay last month – said it was the smaller creditors he felt sorry for.

Creditors are pressuring the UK DTI to investigate MBI’s directors, accusing them of trading while knowingly insolvent.

MBI Logistics was set up in 2000 as a holding company for four operating companies including Mail Brokers International.

“Eyebrows were first raised, ” said IFW’s source, “when clients were served notice in January that they would be invoiced by MBI Logistics, but suppliers were given insufficient notice to reissue their invoices.” On 14 March, Mail Brokers International went into liquidation. MBI Logistics continued to operate and chairman Collin Baldwin insisted that as a separate legal entity, the company had no obligation to its creditors.

Costs were pared back and 90 staff were made redundant, but in May, MBI Logistics also went into liquidation.

The company had always factored its invoices and our source said that the final nail in its coffin was when factor GE Capital Commercial Finance decided it could no longer support the business.

In the year to February 2001, Mail Brokers International made a net profit of just £51,600 ( t83,000) on a turnover of £15.6m ( t25.1m).

The former staff member said the initial damage was caused by a document storage contract in Poland – details of which were allegedly kept even from most of the MBI board – which left an outstanding contractual debt of £4m.

At the start of this year, Royal Mail withdrew a volumerelated discount of up to 4.5% previously offered to larger consolidators.

A creditor appointed to the Mail Brokers International liquidation committee said: “Now that Logistics has gone as well, we don’t know what debts are involved there.” He added: “What was clear from the first creditors’meeting was that the Polish government and several major post offices have all been stung.