A popular Sheffield city centre bar, restaurant and brewery has been declared insolvent with debts of more than £1 million - but will stay open and continue to trade.
The Sentinel Brewhouse in Shoreham Street has called in city accountants Graywoods to sort out its finances after the bar, which only opened last summer, entered into an agreement to deal with creditors.
The firm, which brews its own beer on the premises, has entered into a Company Voluntary Agreement - a deal which allows the business to continue to trade while attempts are made to resolve the situation.
A copy of the letter sent to creditors has been circulated on Twitter and has been seen by The Star and reveals that the company has debts of more than £1 million.
A spokesman for Graywoods said: "It was decided that a Company Voluntary Arrangement would be the most appropriate option to allow the company to continue trading whilst addressing their debts.
"A CVA is a formal procedure which enables a company which is insolvent, yet has a good underlying business, to make a proposal to its creditors that they accept a distribution in full and final satisfaction of their debts, so as to secure the company’s continued survival."
In order for the CVA to become binding on creditors, it must be approved by 75 per cent or more of creditors, voting on the resolution to accept or reject the CVA.
A virtual meeting of creditors has been called for 10am on June 27 to consider the proposal.
Last night, the Brewhouse posted on Twitter saying: "Sentinel is NOT closing. We will issue a formal statement tomorrow. Thanks to those who continue to support us and appreciate what we do."
The former carpet showroom has become a popular eating and drinking venue with real ale fans and for its quirky decor and drinkers can down brews created on the premises.
Creditors requiring further details should contact Danielle Lockwood of Graywoods on 0114 2859500.