What's going on at Discovery yachts?
- Thread starter Seven Spades
- Start date
Daydream believer
Well-known member
Not exactly a "pretty" yacht, is she.
Paddy Fields
Member
In term's of Mr. France's company - If this was a B2B transaction (ie the parties to the contract were 2 companies), then there is non of the consumer protection of a B2C transaction. I wouldn't be surprised if Discovery would have been able to to wriggle out of a lot of their obligations should they have wanted to.
In terms of Discovery's reincarnation - Setting up a new co to take all the assets and none of the liabilities is a common practice in M&A. I suspect there was more to Discovery's decision to set up a new company than this court case. This court case was just co-lateral damage.
Who pays the lawyers bill then? Not old discovery. Not Elusive Yachting Limited, who will probably fold. Looks like its the lawyers who might loose out here!!
Who's gonna want to by MY Elusive now? There is a reason you try to settle these things out of court!!
Concerto
Well-known member
My bet is Mr France will have to pay his lawyers. They might have even taken a charge on the yacht. The legal team will get paid irrespective, but Mr France my end up seriously out of pocket and possibly without a yacht as well. Great win in Court Mr France. Instead of being the winner, he is actually the biggest loser.
pvb
Well-known member
I don't think I've read that Discovery Yachts has set up a new company. I've read that there's been some refinancing. Any links?
Paddy Fields
Member
I take it the keel box is open at the top (like a dingy's dagger board)? Pardon my ignorance, but why wouldn't it be closed? I wouldn't like a great big hole in the bottom of my boat, even if it's lip was above the freeboard level!
Bajansailor
Well-known member
Paddy, if it is designed properly it works very well.
Some friends used to own a 42' Maracuja with a lifting keel, a sistership to the vessel in the link below.
MARACUJA-1985
I have attached a photo of the saloon (of the vessel in the link) - the lifting keel is in the box forward of the mast support pillar. You can lift up the lid and peer inside - my friends always had a small motley collection of fish taking up residence in there as soon as they dropped anchor somewhere. A bit like having your own every changing aquarium.
These folk crossed the Atlantic 30 years ago in their Maracuja taking 14 days from the Canaries to Barbados, averaging a steady 200 miles a day - as they told it, they set two large poled out genoas, wound up the keel and surfed the whole way.
Some friends used to own a 42' Maracuja with a lifting keel, a sistership to the vessel in the link below.
MARACUJA-1985
I have attached a photo of the saloon (of the vessel in the link) - the lifting keel is in the box forward of the mast support pillar. You can lift up the lid and peer inside - my friends always had a small motley collection of fish taking up residence in there as soon as they dropped anchor somewhere. A bit like having your own every changing aquarium.
These folk crossed the Atlantic 30 years ago in their Maracuja taking 14 days from the Canaries to Barbados, averaging a steady 200 miles a day - as they told it, they set two large poled out genoas, wound up the keel and surfed the whole way.
guardian
Active member
So we have an owner setting up some sort of complex tax vehicle (see tax avoidance) in the form of his company to buy the boat, a boat builder who seems to be reaping the 'rewards' based on what they're paying staff (in my opinion) and a bunch of sharks bought in to remedy the situation. Looks to me (on both sides) like a bunch of yuppies all thinking they're cleverer than they actually are.
The result: another boat builder to the wall, an owner without a boat and a win for the sharks, well played - trebles all round.
The result: another boat builder to the wall, an owner without a boat and a win for the sharks, well played - trebles all round.
Resolution
Well-known member
Whilst not a fan of what Mr France has done, I don't think you should knock his tax avoidance. As he clearly intended to scoot off over the horizon, thereby ending his (presumed) tax resident status in the UK, to own the boat through a Channel Islands company would seem rather sensible. Have I missed something heinous?
pvb
Well-known member
No. It's perfectly normal.
Paddy Fields
Member
Fair enough. Im reminded that expedition boats like Garcia and boreal both have lifting keels, so I guess it can’t be all unsafe. So what have southerly done wrong then?
pvb
Well-known member
Well, surprise surprise, there was a creditors' meeting today and Discovery Yachts was "rescued" from administration by a pre-pack deal. So the show goes on, except for all the people who lost a load of money!
Discovery Yachts latest; creditors meeting held today
Discovery Yachts latest; creditors meeting held today
Bajansailor
Well-known member
From the article :
"A pre-pack deal is a mechanism under UK corporate law whereby the sale of an insolvent company’s business and assets is agreed in principle before the company goes into a formal insolvency process such as administration.
The deal, for which no value has been given, means that work on all yachts currently in build or on order will carry on and ensures job continuity for employees"
Does this also ensure that the owners of the yachts currently in build will not lose out?
I seem to remember that a lot of Bavaria customers who had put down deposits (and more) on new Bavaria yachts lost their money when their dealer, (Clipper Marine I think?) went bust (and didn't they get resurrected again soon after, without debt?)
Gotta hand it to these Binti folk - it sounds like they could sell proverbial ice cream to the Eskimos. Seems like they wanted to raise 750k in 2018, did some crowd funding, told a good story along the way, and managed to realise 2.25 million. Not bad going! And then they still go bust a year later.
The crowdfunders must be very disgruntled now surely?
Is there any chance that they will get back anything?
doris
Well-known member
Received today
guardian
Active member
I think the word 'Revelation' will resonate with many after this debacle............
Bajansailor
Well-known member
Isn't there a book of Revelations in the Bible somewhere?
Maybe time for it to be updated - all of these yacht building companies going bust would be good case studies.
Maybe time for it to be updated - all of these yacht building companies going bust would be good case studies.
pvb
Well-known member
As I understand it, the German company didn't get involved until the crowdfunding, when it bought 10% of Discovery Yachts. It subsequently bought another 20% from Sean Langdon.
I imagine the 400 investors who piled so much money into the company have effectively lost their money. It will be interesting to see whether they could mount a class action to claim damages, on the basis that the crowdfunding failed to even mention the legal action by the disgruntled owner (and remember that the legal action was started in April 2018, almost a year before the crowdfunding).
emandvee44
Well-known member
Opal Marine?
M.
pvb
Well-known member
It was Peters-Opal which went bust in 2007. Within weeks, Clipper Marine appeared as the new Bavaria dealer - same people of course.
Bajansailor
Well-known member
Thanks for the clarification re Opal Marine not Clipper Marine.
I did wonder then (still do now) how these folk can sleep happily at night knowing that their shenanigans have caused so many people to lose life savings.
Re the crowd funding, could the investors claim that they had been asked to invest on false pretenses (or something like that), re not being told about the legal action hanging over the company?
I did wonder then (still do now) how these folk can sleep happily at night knowing that their shenanigans have caused so many people to lose life savings.
Re the crowd funding, could the investors claim that they had been asked to invest on false pretenses (or something like that), re not being told about the legal action hanging over the company?