Archive for February, 2010

CARDIFF Devils have pledged business will continue as usual despite millionaire owner Matt Burge being made bankrupt.

Australian entrepreneur Mr Burge was declared insolvent in London’s High Court over an unpaid personal tax bill of £305,000.

He has resigned as chairman of the Elite League side as demanded by companies law and stepped back from day-to-day involvement with the club.

But the Devils’ director of hockey Shannon Hope said the club would continue with their plans for the future, which includes trying to raise finance for a new two-rink ice stadium in Cardiff Bay to replace the team’s temporary home.

“We just crack on,” said former Devils player Mr Hope.

“It’s never a good thing. It’s probably more difficult for Matt but it’s one of those things that can happen. As far as I go, we crack on.”

All Mr Burge’s assets have been placed in the hands of insolvency practitioners based in Bristol whose role is to recoup the debt owed to Her Majesty’s Revenue and Customs.

In a statement issued yesterday, the 40-year-old businessman assured fans of the team that it would not affect the Cardiff Devils.

He said: “Regardless of the negotiations and discussions I am undertaking personally, I can assure all Devils supporters that the club will not be affected in any way.

“The company is structured correctly to be completely independent and a great deal of effort has gone into the financial model to create a self-sustaining business that runs independently of anything else and this has essentially been achieved already.

“Our increased attendances, improved sponsorship, tight control of costs and cash flows have set up a bright future for the club and a strong management team is now positioned to move the club forward with strength and confidence.”

Mr Burge said he was working hard with his lawyers to have the bankruptcy annulled.

It is understood negotiations have been going on for several months with the taxman and that Mr Burge, who lives in a £1.6m home in Penarth’s exclusive clifftop Marine Parade, is trying to have business losses offset against the tax bill.

Among his losses are around £1m invested in Cardiff mobile phone firm CommsDirect which went into administration just before Christmas and has now been partly bought by doctor turned financier Jeremy Stone, who has set up a new company, Veraco.

Mr Burge has resigned as the director of a number of companies but said he was not intending to leave South Wales and return to his native Australia.

He said: “This is a challenge of doing business and is not much fun. It is extremely distracting and annoying but we will get through this.”

He added:“Entering into a individual voluntary arrangement is still a possibility, as is paying the bill. We are keeping an open mind on things.”

Mr Burge took over the ownership of the club from then owner Bob Phillips and his family at the start of the 2008/9 season.

UK arm of Reader’s Digest joins US parent in insolvency proceeding

Reader’s Digest in the UK has entered administration.

Insolvency practitioners from Moore Stephens have been appointed as joint administrators to the popular brand known for its magazine, which has an estimated 500,000 subscribers in the UK.

RD employs 117 staff in the UK, split between its Canary Wharf and Swindon offices.
Phillip Sykes, Jeremy Willmont and Bill Beach of Moore Stephens were appointed to the UK subsidiary of Reader’s Digest Association.

They will run the business as a going concern while inviting offers for the business – as well as reviewing its financial position.

It was "too early to say" what impact the administration would have upon the jobs, administrators said in a statement.

The US parent entered Chapter 11 bankruptcy proceedings last August, but administrators in the UK were unable to comment on the impact of that event on the UK insolvency filing.

The parent said that the UK board made the decision to enter administration after failing to gain support from the UK pensions regulator over an agreement reached between the UK business, its trustees and the Pension Protection Fund over a longstanding pension liability.

The agreement involved the US parent paying a lump sum into the fund, plus handing over an equity stake into the UK business, which would have relieved the UK arm of "significant obligations" associated with its underfunded UK pension plan.

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FORMER Ethel Austin owner Elaine McPherson is considering whether or not to bid for the discount clothes retailer now in administration.

And it emerged the parent company put the business into administration after a petition to wind-up the Knowsley firm was lodged by construction firm Aurelia Properties last week.

A spokesman for administrator MCR said: “There was a winding- up petition, and as a result the parent company and secured charge holder ACLM Holdings Ltd placed Ethel Austin Ltd into administration in order to protect its investment.”

A spokesman for Ms McPherson said it was “too early to say whether she will bid for the company”.

He said she has personally put “millions” into the firm which she bought from administrators in May, 2008.

He said she saw the inability to gain normal banking facilities as the main reason for its failure.

“British banks have been under strain and over the past 18 months have run out of cash themselves.”

Up to 300 staff at the Knowsley warehouse will learn their fate at a mid-day meeting with the administrators today. Many fear redundancy.

_ Liquidation proceedings can be ‘stayed’ (i.e. stopped), permanently or temporarily, on the application of the liquidator, the official receiver, a creditor or a shareholder or the liquidator in proceedings opened against the company in another Member State of the European Union. If liquidation proceedings are stayed permanently, the directors usually regain control of the company. An application to stay the liquidation proceedings can be made at any time after a winding-up order has been made.

_ Liquidation proceedings can be ‘stayed’ (i.e. stopped), permanently or temporarily, on the application of the liquidator, the official receiver, a creditor or a shareholder or the liquidator in proceedings opened against the company in another Member State of the European Union. If liquidation proceedings are stayed permanently, the directors usually regain control of the company. An application to stay the liquidation proceedings can be made at any time after a winding-up order has been made.

London-based building firm Harry Neal has been placed into voluntary receivership.

The firm was founded in 1886, and had a turnover of £40m in 2008.

Directors of the company are understood to have held a series of meetings on Wednesday to discuss its future after a winding-up petition was issued against it on 27 January.

A source at Harry Neal said today that the firm had been left with no choice but to place itself into voluntary receivership. He added that a creditor’s meeting would be held in 14 days.

UHY Hacker Young is expected to be appointed administrator.

It follows news last week that Redworth Construction, which had a turnover of £30m in 2008, was also facing the possibility of liquidation.
A company voluntary arrangement was rejected by creditors of the Yorkshire-based contractor, which specialises in the care sector.

Since 10 December 2009, five county court judgments totalling £78,200 have been filed against the firm and a winding-up petition has also been lodged, with a hearing scheduled for 10 February.

Debtfocus, a debt management firm hired by Redworth, has told creditors that the directors of Redworth will not be contesting the winding-up petition, which may lead to the firm being liquidated.

THE winding up order issued against Plymouth Argyle by the taxman was officially dropped in the High Court this morning.
A hearing was held in the High Court in London today when Her Majesty’s Revenue and Customs asked Mrs Registrar Barber to dismiss the winding up order, which she agreed to do in proceedings lasting less than a minute.
No details of the debt were given in court.
Had the club been compulsorily wound up, it would have effectively handed over the club’s affairs to an Official Receiver.
His job would then have been to do his best to ensure that debts were paid off by selling any assets available and then bringing business to a close.
Last month The Herald revealed how Plymouth Argyle had been issued with a winding up order over unpaid debt.
The football club had settled the debt, which is understood to have been connected to the recent transfer embargo imposed by the Football League.
The Herald understands the transfer embargo, lifted at the start of January, was imposed because the club had outstanding debts relating to transfer fees.
These fees attract tax, and therefore HM Revenue and Customs (HMRC) moved in with a winding-up petition.
It is understood the bills were outstanding because there had been a delay in receiving a £1million loan from the club’s Japanese-based directors Yasuaki Kagami and George Synan.
Speaking to The Herald last month, Lisa Billard, of HMRC, said: "HMRC’s strict duty of confidentiality means we cannot comment on the tax affairs of individual businesses.
"Applying for a business to be wound up is a very last resort and we do all we can to agree time to pay in order to keep viable businesses in business
 

A LEGAL battle over unpaid tax bills will not bring the curtain down on the Isle of Man Bay Festival, organisers of the event insist.
Street Heritage Ltd is facing a winding up order in the High Court after failing to submit its tax returns on time.

But the company insists the move will have ‘no bearing’ on the staging of the Bay Festival in June this year.

>> Final two Isle of Man Bay Festival acts named
29 January 2010

A petition to wind up Street Heritage Ltd was submitted to the High Court by the assessor of income tax Malcolm Couch on January 15.

A date for the petition to be heard has been set for February 24 when creditors and others will be able to appear to support or oppose the making of a winding up order.

Street Heritage founder Jonathan Irving, who brought rock legends The Who as well as Madness and the Stranglers to Peel for the first Bay Festival in 2007, was unavailable for comment.

But a spokesperson for Street Heritage Ltd said the issue would have ‘no bearing whatsoever’ on the Isle of Man Bay Festival, which is run by a separate company.

She said the High Court petition would be contested but added: ‘We do believe this can be settled long before it gets to court.’

In a statement she said that the company had fallen behind on submitting its tax returns.

She added: ‘However, in December we appointed a firm of accountants to take over who are now dealing with it. This is a matter for Street Heritage Limited only and has no implications for any other associated companies.’

The spokesperson declined to give a figure for the amount of unpaid taxes owed by Street Heritage Ltd.

Boy band JLS and 80s legend Spandau Ballet will be among the headline acts taking to the stage at Noble’s Park during the three-day festival running from June 18 to 20.

 By Shane Phelan Investigative Correspondent

Saturday January 30 2010

EAMONN LILLIS is set to net more than €350,000 from the winding up of the business he ran with his wife Celine Cawley.

Lillis (52) put the couple’s successful television advertising company, Toytown Films, into voluntary liquidation shortly after Celine’s death in December 2008.

The couple each had a half share in the business. Celine’s share passed to her sister, lawyer Susanna Cawley, after she died.

Company documents seen by the Irish Independent reveal that once the company’s debts are settled it is expected to have a surplus of €718,000, which can then be distributed to the shareholders.

As Lillis had a half share in the company, it is likely he can expect to receive 50pc of the funds left over.

The surplus is mainly due to the healthy bank balance Toytown had at the time of Celine’s death.

The company, which was based at Windmill Lane in Dublin, had €636,000 in its bank accounts, with a further €95,000 cash in hand.

Successful

It was also owed almost €18,000 from trade debtors at the time. And further sums, totalling almost €55,000 were expected to be accrued in tax and redundancy refunds. Its total liabilities, including all outstanding bills and liquidator fees, stood at just €91,700.

Liquidator James Clancy did not return calls seeking comment.

Celine’s death and the charging of Lillis with her murder meant it was virtually impossible for the company to continue.

Toytown was behind some of the most successful television advertising campaigns of the past decade.

Its clients included Guinness, Carlsberg, Heineken, Coca-Cola, the National Lottery, O2 and McDonald’s, among other big names.

One of its most memorable advertisements was for Walker’s crisps, featuring Roy Keane in a leprechaun suit.

The firm was set up by Celine in 1990 and she was considered the driving force behind its success.

Her father, solicitor James Cawley, and her brother, Christopher, were also directors of the company in the early 1990s, but are no longer involved.

Lillis joined the company in 1992 and has been a director ever since.

Although company documents show they had an equal share, Celine earned much more than him. Lillis’s trial heard that his wife’s salary was €500,000, while his was just €100,000.

- Shane Phelan Investigative Correspondent

Irish Independent

MUMBAI: Troubled pharmaceutical company Wockhardt has told its foreign lenders that it will not sell any assets as long as winding-up petitions filed by them are being heard by the Bombay High Court.

Wockhardt wrote letters to the overseas creditors on Saturday and Monday confirming that it would not sell any of the assets of its domestic and foreign subsidiaries though the company’s promoters, the Khorakiwalas are free to encash their personal assets, if they want to, said a person close to the development. The person, who did not wish to be named, said the letters sent by Wockhardt was in line with an oral direction from the court on Friday.

When contacted, the Wockhardt spokesperson said the company’s chairman Habil Khorakiwala could not be reached for comments. ET had reported last week that the Khorakiwala family had reached an agreement to sell nearly 18 acres at Mulund for Rs 200 crore. They would be free to carry out this transaction.

Late last year, Wockhardt’s foreign unsecured creditors, including Calyon, Barclays Bank, Singapore-based DBS Bank as well as several holders of the company’s foreign currency convertible bonds, filed so-called winding-up petitions in the Bombay High Court after the company failed to pay them. Winding-up petitions are often filed by lenders, who want the court to order the liquidation of a company, as they have not been paid.

The foreign lenders had also opposed a corporate debt restructuring (CDR) plan agreed between Wockhardt and its Indian lenders on the ground that it was skewed in favour of domestic institutions. The CDR, initiated by Wockhardt in July last year, seeks to reduce interest rates on its debt and extend the repayment period.

In the high court, the overseas creditors also sought a blanket stay on Wockhardt’s plan to sell its assets, including its nutrition business to the US company Abbott. The Indian pharmaceutical major had reached an agreement to sell the nutrition business, but could not execute the deal, as the lenders moved the Bombay High Court.
On the foreign financial institutions litigating in the HC, DBS Bank has reached an out-of-court settlement with the company.

Justice SJ Kathawalla, who was hearing the case, on Friday asked Wockhardt to clarify with its foreign lenders, which assets it could sell. He also observed that if the lenders had any grievance regarding Wockhardt’s undertaking, they could approach the court on February 1 and he would pass an order in the case.

Since the foreign lenders were satisfied with the letters sent by Wockhard over the weekend, they did not approach the court on Monday. The case will now come up for hearing on Thursday.

While Wockhardt is being represented by Majmudar & Co, the foreign banks are being represented by Juris Corp and FCCB holders by DSK Legal.