Over 400 workers are facing an uncertain future after Asda and Sainsbury’s chilled food distributor, EVCL Chill, fell into administration.
According to The Grocer, administrators PwC took over the beleaguered company on Saturday.
“This has been a very difficult situation and involved intense discussions with key stakeholders… to get to this position,” PwC partner Eddie Williams said.
Despite turnover of around £167 million last year, its administrators said EVCL Chill has been rocked by “acute driver shortages” and losing key customers.
Although 658 jobs were saved when Sainsbury’s and Asda took over “a number of services” to prevent supplies running low, 434 employees were not transferred.
They will be updated on the administration process later today.
Asda supply chain officer Mark Simpson said it had been a “difficult week” for EVCL workers, after their “huge resilience” during the pandemic.
The retailer hopes to employ some of those who were not brought across at its chilled depot in Lutterworth, Leicestershire.
One source claimed it could cost the Big 4 grocers “millions” to keep EVCL afloat, which supplied them with up to 10,000 pallets a day.
Contracts will need to be renegotiated following its administration, potentially meaning a second pay-out for hundreds of drivers and warehouse staff.
Its collapse comes less than two years after its predecessor, NFT Distribution Holdings, was placed in administration.
Select assets of the business were then reacquired by EV Cargo, it parent company, to create what would later be named EVCL Chill.
PwC said the administration did not affect EV, which continued to trade as normal.