Administrators are preparing the legal closedown of the North West Enquirer which ceased publication in September and has a financial deficit of more than £850,000.
No outside party expressed a serious interest in buying the upmarket weekly paper launched in April by Bob Waterhouse and Nick Jaspan to cover the Northwest region.
The deficit includes £342,000 owed to unsecured creditors, including freelance journalists, and in excess of half a million which investors ploughed into the company. Administrator Harrisons is currently preparing a report to issue to all creditors. A partner in Harrisons, John Sallabank, told Press Gazette: "No one is going to benefit out of it at all, basically — it's not going to be a good position. It never was envisaged to be a good position at this stage of the business — they were obviously looking to ramp up the sales. It was always forecast to make a loss in the initial stages while all these things were built up. That's why all the shareholders' funds and capital went in to support that position."
Harrisons has sold the assets of the company, including goodwill in the name and the tangible assets such as computer equipment, desks and chairs. The company went into administration after 21 issues in September, when one of the backers changed the conditions on their investment. No serious interest was found outside the company but existing investors had tried to save the title. Sallabank said: "It was existing funders who were looking to see whether there was any mileage in going any further. Some of them believed there was at one stage, but once that was explored in greater depth it didn't progress.
"The shareholders and venture capitalists had their ideas of what level of return they wanted and what criteria they wanted within that and when that didn't occur they had to make a reassessment. "We have to now deal with the legal closedown of the business when the company will just die and be struck off the register.
"Any money owed will then effectively be written off. Creditors can write it back as a bad debt so they can get some tax relief. The most interest we have had from creditors, as you would expect, has been from the freelances."