It is difficult to see how the now ironically named Debtmatters is going to trade its way out of its current problems.

The company today effectively put itself up for sale, when it announced a “strategic review” prompted by contracting insolvency signing-on and advisory fees and the high cost of daytime TV adverts offering help to debt-laden individuals.

Making money out of advising on Individual Voluntary Arrangements (IVAs) is Debtmatters and yet it failed to act quickly enough when an industry-wide 20 per cent fee cut was announced in July, making a rather feeble attempt to diversify its business by setting up a debt management division.

The funny thing is, in a market where consumers are saddled with borrowings, Debtmatters should be doing brisk trade and if it wasn’t saddled with its anchor of an IVA business, its chances of survival would be much better.

In its favour it does have a portfolio of IVAs worth £20 million. If it sells these, and gets out of this line of work, Debtmatters might have a future. However, the likelihood is with a market value of £5.8 million, a vulture will swoop in and pick the best bits off Debtmatters’ bones. Investors should get out now. Sell.

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