Hugh Fearnley-Whittingstall’s television production company has collapsed, leaving behind millions of pounds of debts.
The River Cottage chef co-founded the award-winning KEO Films in 1995, which has made popular programmes such as Hugh’s War on Waste and Easy Ways to Live Well. The company describes itself as having a “strong ethical brand reputation” and has produced a series of programmes campaigning for social change.
This summer the business was sold to a rival in a pre-pack administration deal after declaring itself insolvent. Creditors, many of them owed substantial sums, now face being left substantially out of pocket.
Insolvency documents show that the directors of KEO Films, including Fearnley-Whittingstall, paid themselves £4m over the last seven years, even though the company consistently failed to record a profit and ran up millions of pounds in debts during that period.
When it came to rescuing the business, the company directors collectively declared they were unable to put enough money into the business to maintain it as a going concern.
Financial disclosures show that the company, which recently made the acclaimed BBC documentary Once Upon a Time in Iraq, was described as having a “weak financial position” in late 2019. When it eventually decided to enter administration, it blamed the impact of the coronavirus outbreak for its collapse. The business was ultimately sold for £1.7m to Passion Pictures.
The restructuring firms responsible for the deal said this was the best outcome for the business and saved about 20 jobs at the company’s headquarters.
The new owner says it is now doing its best to voluntarily repay as much as possible of the amount KEO Films owed to freelance television workers and small businesses when it went bust.
“We are trying to do the right thing in a difficult situation,” said KEO Films’ creative director, Will Anderson. “We don’t want to get a bad reputation, we are trying to come to arrangements with people where we can.”
He said that while not all of the old company’s debts could be repaid, offers had been made to repay the majority of freelance employees in full. He accepted KEO historically had a poor reputation for settling invoices late but the company hoped to come to agreements with other small businesses to help it recoup some of their losses.
Fearnley-Whittingstall owned a quarter of KEO’s shares. Although he stepped down as a director after it was sold, he will continue to make programmes with the company under its new owner.