Tough Mudder appoints BM Advisory as UK administrator

The European operation of outdoor sports group Tough Mudder has returned to trading, despite an international stand-off with its US wing. The UK-based European operation has installed BM Advisory to oversee proceedings.

Tough Mudder is an endurance event series in which participants attempt 10–12-mile-long obstacle courses. The obstacles often play on common human fears, such as fire, water, electricity and heights. It was co-founded by Will Dean and Guy Livingstone.

Earlier in 2020, the pair were accused of placing the company in a state of paralysis and ignoring the interests of creditors in holding out for a larger share of the company’s proposed sale to rival Spartan Race. Spartan made a ‘seven-figure’ offer for Tough Mudder in November last year, and agreed to acquire the trade debt across all Tough Mudder entities. However, a disagreement about the sale caused the company and its European, Canadian and German affiliates to suspend registrations and ‘go dark’ towards the end of last year.

Dean and Livingstone demanded what news site SportBusiness understands is a combined $44 million from Active Networks to sanction the sale of the indebted company. They had asked for $40 million, but the figure increased when Active missed a deadline to meet their demands. The continued stand-off with its largest lender eventually caused the company to cease trading, and the US wing of Tough Mudder and its UK-based European operation became the subject of parallel bankruptcy proceedings.

In late January, the judge presiding over bankruptcy proceedings against the US wing of the company filed an order directing the appointment of a Chapter 11 trustee. Now, in the UK, the European operation of the company has been placed into administration, with BM Advisory administrators opening the company back up for trading as a result. Michael Solomons and Andrew Pear of restructuring, recovery and insolvency specialists BM Advisory were appointed joint administrators of the business.

Staff at the European affiliate of Tough Mudder have since returned to work. Spartan Race remains the most likely buyer for the US and European parts of the business, provided the US business resumes operations soon. In the case of the European administration, Spartan Race has supported the process with the necessary funding to resume trading, while the administrators have also engaged both Giles Chater and Kyle McLaughlin, formerly of the Tough Mudder European management team, to support the business going forward while a sale is achieved.