The firm announced yesterday in a statement that “sufficient funds for maintaining the going concern could not be found”.
Insolvency proceedings began in January and the German-based parent company had already separated from its subsidiary firms, Paddle8 in the US and ValueMyStuff in the UK, which it says have been sold and “will continue to operate”.
Following these sales, the process of winding up the company is underway in Germany while London-based ReSolve Partners has been appointed administrators of its operations in the UK (Paddle8 Auctionata Limited).
In Germany, around 30-40 of Auctionata’s 170 employees will stay on through the winding-up process although Thomas Hesse, who took over from Auctionata’s founder Alexander Zacke when he became “restructuring CEO” last year, is one of those leaving.
The German administrator Christian von Brockdorff said: “Despite convincing work of the new management team and a new strategic set up for the German company, the time frame was not sufficient to secure the necessary funds for a continuation of the business in Berlin.”
He added that he is currently “evaluating additional opportunities for selling partial business assets of the company”.
Meanwhile, around 25 employees have reportedly been laid off at Paddle8 since an agreement was reached with “a leading investor group and supported by the management team” to buy the brand and business.
In a ‘statement of proposal', ReSolve Partners said that the firm’s UK operation had been struggling to meet its costs since incurring a financial loss from organising an event known as ‘London Week’ in the autumn of 2016.
Subsequently, the failed round of fundraising in Germany meant that the parent company could not alleviate the pressure on the UK branch, leading to creditors not being paid and staff having unpaid wages.
The administrators have now reached a deal to sell the UK company’s assets for £120,000, of which £115,000 comprises intellectual property and £5000 plant and equipment.