The liquidator for AstraZeneca’s former manufacturing plant near Bristol criticised the behavior of the group who acquired the facility, claiming that they “delayed and diminished” the returns to creditors.
Administrators were appointed to the Avlon site in 2019, about two years after AstraZeneca, Britain’s biggest drugs company, had sold it to Avara, a contract manufacturer owned by Leonard Levie, 67, a former Lehman Brothers banker-turned-industrial investor, for £1.
Begbies Traynor, an insolvency firm, has been appointed to liquidate Avara Avlon Pharma Services after the long-term sale of the property for approximately £18.5million. The Canadian company EDC purchased the site.
The factory’s collapse has been controversial. AstraZeneca decided to set aside £12,000,000 in July 2019 to pay enhanced redundancy to Avlon employees after criticism from MPs. Former Avlon employees accused AstraZeneca, claiming that the company had not done enough due diligence in its sale and given misleading information to their staff. AstraZeneca denied these claims and informed Avlon employees that “AstraZeneca has set aside this funding because Avara failed to meet its commitments”.
Begbies, however, said that this figure did not match the records of the Avara Group companies we reviewed or the certified statement signed by both directors. . . The Avara Group’s behaviour is unfortunate. . . “This is a significant delay and reduction in the distribution of the general group of creditors.”
JP Morgan had agreed to not make a claim, but now has made a claim. This helped the returns to the unsecured creditors. Begbies, however, said that JP Morgan, the secured creditor, now claimed its security as valid, and Begbies had to delay declaring dividends for unsecured creditors.
A court in the United States last month rejected JP Morgan’s attempt to appoint receivers over the assets at another Avara Group drugs plant in Oklahoma, in a dispute regarding Avara’s debts to JP Morgan.
Levie’s spokesman said: “While AstraZeneca terminated a contract, it was regrettable. American Industrial Acquisition Corporation (the investment firm Levie co-founded and chairs) and Avara are proud to have extended the life span of the Bristol facility by 2.5 years past AstraZeneca stated termination date. They also remain proud of having saved thousands of job. . . “They are also happy that AstraZeneca has finally, if late, fulfilled its legal obligation to pay former employees the enhanced payout AstraZeneca had promised.”