More than 70 workers based at collapsed parcel delivery firm City Link’s Swindon depot face an anxious few days as they wait to find out if they are to lose their jobs.
The depot, pictured, on Wootton Bassett’s Interface Business Park, is the firm’s largest in the South West and employs 73 staff. They returned to work today after finding out from media reports on Christmas Day that City Link had gone into administration on Christmas Eve. 
Administrators EY reopened all City Link’s 53 depots and three transport hubs today along with its Coventry head office to clear the backlog of undelivered parcels.
Around 2,000 of its 2,780 staff are expected to be made redundant by the administrators on New Year’s Eve. The remainder will be kept on to for around three months to oversee the sale of its assets, which are mainly parcel sorting and IT equipment, and wind down the business.
City Link, which has incurred huge losses over recent years, rented its depots and leased its delivery vehicles. The administrators had unsuccessfully attempted to sell the business as a going concern and are now likely to accept bids that break it up.
The firm’s demise was blamed on intense competition in the parcel delivery sector, changing customer and parcel recipient preferences, and difficulties in reducing its cost base.
City Link was sold by previous owner pest control company Rentokil Initial to private equity firm Better Capital in April 2013 for just £1. The firm has made a loss since 2007 – the year after Rentokil acquired it – including £26m in 2012.
Better Capital, founded by private equity veteran Jon Moulton, ploughed £40m into City Link. It has emerged that the investment was made in the form of a secured loan – meaning Better Capital will be paid ahead of its redundant staff. Better Capital has said it expects to get around half of its investment back.
The RMT union, which represents City Link staff, has called on EY not to make any redundancies until meetings have been held with Business Secretary Vince Cable to look at nationalising the business and saving jobs.
