Oyster Yachts gone into administration

[lpdsn]

I'm not aware of anything remmotely comparable.
However, this is thread drift to some extent.
It would seem that Oyster and their customers had pretty much put this disaster behind them.
There seems to little to suggest that the Polina incident/saga directly caused the cash crisis this year?

I thought it was stated in one of the press reports that the Polina Star was given as the reason for a £1m p.a. profit becoming a £5m p.a. loss. OK, I'm not one to automatically believe the press but it does sound vaguely plausible given what you might expect a recovery of the wreck plus recall of the sister ships for repair plus compensation of the owner plus maybe claims from the crew and a few associated legal bills to cost. Nor is it unreasonable to expect that it was all over and done with.

That for a company that was valued at £15m the last time it was sold.

Of course this is all pure speculation, but it is the internet....

 

[pvb]

I thought it was stated in one of the press reports that the Polina Star was given as the reason for a £1m p.a. profit becoming a £5m p.a. loss. OK, I'm not one to automatically believe the press but it does sound vaguely plausible given what you might expect a recovery of the wreck plus recall of the sister ships for repair plus compensation of the owner plus maybe claims from the crew and a few associated legal bills to cost. Nor is it unreasonable to expect that it was all over and done with.

I'd imagine the recovery of the wreck was paid for by the Polina Star's owner or insurer, certainly not by Oyster. The 2015 accounts for Oyster Marine Ltd included an allowance of more than £5 million related to a possible claim against Oyster for the loss of the Polina Star. There was a note suggesting that settlement might be reached in 2017, but I imagine it hasn't been settled.

 

[lpdsn]

I'd imagine the recovery of the wreck was paid for by the Polina Star's owner or insurer, certainly not by Oyster.

That's grand. Very generous of them not to think of getting their money back from Oyster.

 

[pvb]

That's grand. Very generous of them not to think of getting their money back from Oyster.

Rather than being generous, I think they were just making sure they got the evidence to nail Oyster. Obviously, they would have claimed the cost back from Oyster. Sadly it's probably too late now.

 

[lpdsn]

Rather than being generous, I think they were just making sure they got the evidence to nail Oyster. Obviously, they would have claimed the cost back from Oyster. Sadly it's probably too late now.

In that case it comes back to my point a few posts up. Company was worth £15m last time it was sold. Seemed to be making circa £1m p.a. under normal circumstances. Had already recorded a loss of £5m (let's speculate that was some already incurred costs for Polina Star plus the £5m provision). Total finger in the air guess that there were more costs to come.

You can easily see that it is plausible that as a result of the Polina Star loss the PE investor had decided to throw in no more money and walk away from their £15m - maybe not even walk away from all of it depending on what the true facts are about which companies are or are not in administration and what he might still get back for the IPR and moulds and other bits and pieces of the associated companies.

 

[pvb]

You can easily see that it is plausible that as a result of the Polina Star loss the PE investor had decided to throw in no more money and walk away from their £15m - maybe not even walk away from all of it depending on what the true facts are about which companies are or are not in administration and what he might still get back for the IPR and moulds and other bits and pieces of the associated companies.

That's basically the assumption I made in post 118, based on the fact that the third Oyster 825 is owned by Wim de Pundert, the majority owner of HTP Investments, the private equity company which owns Oyster. I surmised that facts may be emerging now about the design and construction of the 825s which annoyed Mr Pundert sufficiently to pull the plug on what was, after all, a very small company in his terms. He is one of the richest men in the Netherlands, with wealth estimated at around €400 million.

 

[lpdsn]

That's basically the assumption I made in post 118, based on the fact that the third Oyster 825 is owned by Wim de Pundert, the majority owner of HTP Investments, the private equity company which owns Oyster. I surmised that facts may be emerging now about the design and construction of the 825s which annoyed Mr Pundert sufficiently to pull the plug on what was, after all, a very small company in his terms. He is one of the richest men in the Netherlands, with wealth estimated at around €400 million.

I'm not going so far as to say he might have done it through annoyance in any way, merely speculating that he'd reached the point where he thought there was no point in throwing good money after bad, and that because of the costs that were likely to continue to be incurred because of the loss of Polina Star III.

 

[PhillM]

Rather than being generous, I think they were just making sure they got the evidence to nail Oyster. Obviously, they would have claimed the cost back from Oyster. Sadly it's probably too late now.

But surely they would have product liability insurance themselves?

 

[pvb]

But surely they would have product liability insurance themselves?

I imagine Oyster would have had product liability insurance, but there are often exclusions relating to negligence. In any case, Oyster stated that they had made a claim against a subcontractor for around £7 million.

 

[Bobc]

Don't know if anyone else has seen this, but just out in Boating Business News:-

Administrators have been appointed for Oyster Marine Holdings Ltd, the holding company for the Oyster Yacht group of luxury boat builders.

The company is headquartered in Southampton and also trades from Wherstead in Suffolk and has two employees.

It owns the intellectual property to all the technical drawings and moulds used in the production of yachts in the Oyster range.

Administrators KPMG Restructuring has confirmed no other companies within the group form part of this administration.

“Late last week, the company directors confirmed that they had been unable to secure the financial support they needed to continue to trade the business,” said Neil Gostelow, partner at KPMG and joint administrator with KPMG’s Mark Orton. “Our immediate priority will be to seek a buyer for the business and its assets and would encourage any interested parties to contact us as soon as possible.”

Considering options

KPMG has confirmed Oyster Yachts, the company’s main trading business, is currently considering its options having failed to secure financial support.

A statement from David Tydeman, Oyster CEO, confirmed the company did not have the finances to continue.

“It is with sincere regret that we advise that the company has been unable to secure financial support to enable it to continue at this time and it is looking at all opportunities available,” he said. “Further information will be issued as soon as we can.”

The Oyster group comprises Oyster Marine Ltd, Oyster Brokerage Ltd and Southampton Yacht Services Ltd.

 

[CCJ]

In that case it comes back to my point a few posts up. Company was worth £15m last time it was sold. Seemed to be making circa £1m p.a. under normal circumstances. Had already recorded a loss of £5m (let's speculate that was some already incurred costs for Polina Star plus the £5m provision). Total finger in the air guess that there were more costs to come.

You can easily see that it is plausible that as a result of the Polina Star loss the PE investor had decided to throw in no more money and walk away from their £15m - maybe not even walk away from all of it depending on what the true facts are about which companies are or are not in administration and what he might still get back for the IPR and moulds and other bits and pieces of the associated companies.

Did Mr Pundert`s Oyster make the Co any profit, it may well have been bought by him "At Cost".

 

[pvb]

Did Mr Pundert`s Oyster make the Co any profit, it may well have been bought by him "At Cost".

Oh, I'm sure he got a good deal! It's likely that he only bought Oyster because he's a keen sailor. The purchase of Oyster was rather out of character, most of HTP's investments have been in German automobile-related industries.

 

[lw395]

......

KPMG has confirmed Oyster Yachts, the company’s main trading business, is currently considering its options ......

Oyster Yachts Limited is listed on Companies House website as 'non trading'. A dormant company.

 

[Laser310]

I would imagine the concern of customers is that their deposits are in the form of ownership of a part finished boat, which nobody is currently turning into a finished boat.

That's what happened with Gunboat

Any deposits not in the form of a hull were lost, but the customers did own their partially completed hulls, and the hulls were not subject to claims by other creditors. At least that's the way I understood it

The problem was that without an operating yard to complete the boats - mold the decks and other parts, and so on.., some of the hulls were nearly worthless. Boats close to completion were completed by the owner, but others were not.

The owners of boats in-build at Oyster might decide it's worth the cost to keep the yard going and complete their yachts...

 

[pvb]

Oyster Yachts Limited is listed on Companies House website as 'non trading'. A dormant company.

I think the press reports have used "Oyster Yachts" as a sort of general name for the group.

 

[Tranona]

That's what happened with Gunboat

Any deposits not in the form of a hull were lost, but the customers did own their partially completed hulls, and the hulls were not subject to claims by other creditors. At least that's the way I understood it

The problem was that without an operating yard to complete the boats - mold the decks and other parts, and so on.., some of the hulls were nearly worthless. Boats close to completion were completed by the owner, but others were not.

The owners of boats in-build at Oyster might decide it's worth the cost to keep the yard going and complete their yachts...

That depends entirely on the nature of the contract. The common form of contract for a custom yacht in this country is that title to the boat passes to the buyer in stages as payments are made. Usually this occurs at fixed points and a sensible buyer engages a surveyor to confirm the work has been done before the payment is made. The buyer will therefore own his part complete boat, but of course has to find a way of completing it.

An alternative style of contract is for the builder to hold the buyer's funds in a secure client account and draw on them in stages.

You have to remember that almost by definition Oyster's buyers are wealthy and financially aware so are unlikely to become significant unsecured creditors. Their major concern will be finding a way of getting their boat completed.

 

[SO40]

But who in his right mind would buy Oyster Yachts now? And I mean the company, not a boat. It is not just getting on a slippery slope, but stepping into a financial sinkhole!

 

[lw395]

But who in his right mind would buy Oyster Yachts now? And I mean the company, not a boat. It is not just getting on a slippery slope, but stepping into a financial sinkhole!

A buyer might buy part of the business.
I imagine a buyer might buy the order book, tooling etc for all or part of the range, leaving the liability for the past in a holding company which will be wound up.
There is certainly a business opportunity in finishing the work in progress.

The brand is clearly worth something as the sinking has not stopped them taking new orders.

 

[bedouin]

But who in his right mind would buy Oyster Yachts now? And I mean the company, not a boat. It is not just getting on a slippery slope, but stepping into a financial sinkhole!

Depends on the details, but I gather that there has been some investment in the company by the present owners and they have a strong order book. Unless the boats have been sold too cheaply then it should be possible to make a good profit with that level of orders.

I don't know much about this end of the market but it would not be unreasonable for a manufacturer to make 20% profit on a boat, so £80m orders is £16m profit - not bad if you can pick (the assets of) the company up for £15m

 

[SO40]

@lw395: and who are going to finish these boats? (sorry, yachts :ambivalence These are not bulk produced boats with CNC cut parts, profiles and prefab segments. Oysters are more or less hand made..... I would imagine a lot of staff just being made redundant are not going to queue up to work for Oyster again. I wouldn´t!