Northshore creditors meeting

Teetime said:
All I know is that the loss of such a fine firm of boatbuilders like Northshore is tragic.
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It sounds like they're not lost, though. From what I'm reading here, they seem to have deployed an accounting trick to avoid having to pay a load of their suppliers, and will shortly be continuing business as usual.

Pete
 
Teetime said:
All I know is that the loss of such a fine firm of boatbuilders like Northshore is tragic. Both to the staff and buyers of the boats. It's a crying shame.
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And what about the poor sods who were owed money, had supplied goods and are not going to be paid? They are the true losers in this situation.
 
gerry99 said:
And what about the poor sods who were owed money, had supplied goods and are not going to be paid? They are the true losers in this situation.
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In the latter time I was with BAe and one of the several reasons I left, I once had a call misdirected to me at Photographic; it was from a chap who ran a small specialist electronics outfit, they'd put their company's future into building a special test rig which BAe desperately needed to meet a contract, then no pay - this was months later and BAe was out of the hole.

I managed to point him to a real manager with the motto ' UK Ltd ' who I knew could help, but I discovered that it was standard BAe accounts policy not to pay bills for at least 3 months, and with the later generation of sub-human sub-managers, if the smaller company went to the wall in the meantime all the better for the + & - figures.

As with politicians, these idiot ' managers ' just looked at immediate figures and knew they wouldn't be around when the damage they'd done came home to roost...

I hope Northshore does keep going, particularly for the sake of the skilled employees, but if they shaft their suppliers they are on a slippery slope.
 
prv said:
It sounds like they're not lost, though. From what I'm reading here, they seem to have deployed an accounting trick to avoid having to pay a load of their suppliers, and will shortly be continuing business as usual.

Pete
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Don't think there is any "accounting trick". There is more to this than meets the eye. This is a shareholder liquidation, not forced on it by creditors. It seems clear that somebody has taken the decision that given the current finances of the company it is not able to trade out of its current difficulties and return to profitability. On the other hand there is probably a viable business in there with a different structure and possibly owners. Whether there is enough willingness on the part of suppliers, employees and providers of finance to make this happen we shall see.
 
It will be interesting to see what happens with the trade creditors.

IPC is a good example. They are owed £29,500 according to the article. At the moment the creditors are looking at virtually no pay out.

So, along comes the new Phoenix company. Having rid itself of all debt, they now have a new structure, they have renegotiated the rent and use of tooling etc. from their "landlord" and now feel ready to advertise again.

The only way IPC can get any of its £29,500 back is by taking the business, albeit on stricter terms, and making up the losses through future margins.

Walk away on principle? I think not.

Perhaps some of the boat reviews might be less syrupy though. :)
 
All suppliers will supply the new company I am sure otherwise you are cutting off you nose.. However I would want payment upfront and I would expect people in a position of power like the keel manufacturer to increase prices to make up for their loss.
 
Having read that news report again, I found this line intriguing:

"Mr Abbott invested heavily in expanding the Southerly range, building two new factory buildings – the latest of which was opened by Princess Anne in 2010 – and in state-of-the-art machinery to streamline the production process."

I would imagine at the time the PR release touted, or at the least alluded, that Northshore was making a big investment and what a bright future it had. The reality is that Northshore made no such investment, but a different "property company" made the investment.
 
rb_stretch said:
"Mr Abbott invested heavily in expanding the Southerly range, building two new factory buildings – the latest of which was opened by Princess Anne in 2010 – and in state-of-the-art machinery to streamline the production process."

I would imagine at the time the PR release touted, or at the least alluded, that Northshore was making a big investment and what a bright future it had. The reality is that Northshore made no such investment, but a different "property company" made the investment.
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And yet after all this, Princess Anne brought a new Rustler.. :D
 
savageseadog said:
A landlord is the most preferential creditor because he can simply lock the doors and seize everything that belongs to the company (and probably everything else too) in lieu of rent. The relationship between landlord and tenant is irrelevant it can be part of the same group, directors personal property, pension fund or whatever.
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Er, no they can't. A landlord can't levy distraint against Tools of the Trade i.e. machinery and tooling nor can he seize items belonging to others, i.e. the boats in build or stock not paid for. So therefore he is then restricted to seizing stock or cash on the premises, which by the sounds of things there wasn't a great deal of either.

The landlord could alternatively seek forfeiture of the lease for non-payment of rent but in today's times that really is not a sensible option.

Then of course neither of the above remedies is available once the notice of intention to appoint administrators is placed.

I am aware the landlord in this case is a group company but in almost every insolvency where a pre-pack deal is the outcome, like this appears to be, the landlord is by far the biggest unsecured creditor and yet is still faced with the prospect of having to agree a very soft deal with the "new" company or end up with empty premises with no immediate prospect of re-letting and no long term relief from crippling Business Rates!

At least a supplier who's had his fingers burnt can tell them to sod off when they come looking to deal with them again!

And yes I am biased!
 
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prv said:
Errm, what?

That's the news story that SolentBoy started this thread with.

Pete
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No, he started it long before this meeting which confirmed the rumours he had heard. Think you will find that the clue to what has happened lies in the November 2012 restructuring and the comments in the last sentence of the press report.

The losers are suppliers, government, employees (although the government redundancy payments will soften the blow a little) and (possibly) shareholders, but not customers - at least not in a direct financial sense as all will seem to get their boats.

As others have pointed out, many suppliers will be prepared to deal with the new company even if they have lost. Terms however will be different but for many it will be a choice between recovering something rather than losing the lot. Others may, of course prefer not to deal with them under any circumstances.
 
toad said:
Don't Southerly have two factory's, one for fitting out and one for building the hull and deck. If so what's happened to the other factory.
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The other factory was for Northshore Composites, they changed their name to NCO Ltd about a year ago and were prompttly put into administration and liquidated using the same firm of lquidators as NSY (Southern) ! Read the T&C's on the Southerly website and its plain to see what is planned, Southerly Yachts Ltd are waiting in the wings.
 
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