The business had been experiencing cashflow problems and, despite award-winning marketing for its brands, had struggled to achieve the listings and sales that matched the publicity the wines received.
Directors called in Menzies Corporate Restructuring before Christmas to take over the company’s affairs. Administrator Andrew Stoneman said he was hoping to sell the business as a going concern, but it is possible that Stormhoek or other assets may be sold individually.
“We are trying to meet customers’ requirements at the current time,” he said. “We’re pretty hopeful that this will only be a relatively short period of time before we find a buyer. We’re speaking to a number of interested parties who have shown an interest in taking the brands forward.
“We’re dealing with the suppliers and people that hold the wine and obviously speaking to customers as well.”
Staff – including managing director Mike Paul, founder Nick Dymoke-Marr and owner Jason Korman – did not receive Christmas pay cheques and were handed redundancy notices this week. The administration also covers sister businesses California Direct and Bulk Brokers International, but not the South African production business.
OLN understands that Orbital’s bankers, Royal Bank of Scotland, had been concerned about the state of Orbital’s accounts in the autumn and discussed a number of restructuring options before the administrator was called in.
One insider described the demise of Orbital as “absolutely tragic” but admitted that mistakes had been made. Stormhoek was recently delisted by one major retailer who was unhappy with the lower retail price available to a competitor.
The source added: “Somebody may just buy Stormhoek on its own or they might buy the whole thing. We wanted to create a brand that took advantage of the change in social media and would grow from word of mouth, not just supermarket promotions.”
Industry consultant and former Seagram and Oddbins boss John Ratcliffe has been appointed by Menzies to assist with the disposal of Orbital’s assets. Paul Coolit is dealing with all prospective buyers and can be contacted on 020 7487 7240.