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NORTON SETTLEMENT STILL VAGUE

Having rolled the bankrupt Norton Motorcycles UK concern into a legacy liquidation vehicle, NMUL Realisations, administrator BDO has pretty much sorted out secured interests and is approaching the point of pay-outs for lesser mortals. But who will get what, and how much, remains as clear as mud. BDN financial editor Roger Willis reports.

Armed with £16m from acquisition of Norton’s IP and physical assets by TVS Motor, BDO has first dealt with secured creditors holding charges against slightly more than £8.8m. Of these, insolvency initiator Metro Bank was owed £4.04m by Norton, which it has already collected, and £3.07m by the associated Donington Hall Estates — subject to a separate administration also conducted by BDO. This latter amount is doubly secured by a cross-company charge, so Metro will get it one way or another. A further secured £1.7m was owed by Norton to Tudor Capital. HMRC will be able to trouser outstanding taxation too.

Unsecured creditors, comprising trade suppliers and lots of unfortunate customers who had coughed up deposits on bikes they never received, are apparently now due another £8.8m — rising from an earlier estimate of £6.2m. But, after BDO has extracted its no-doubt copious fees, the NMUL Realisations pot will have fallen to below £7m. So haircuts will be in order for any distribution.

The property holdings of Donington Hall Estates, including Donington Hall itself, Priest House Hotel, Hastings House, the Lansdowne Buildings, Kings Mills Caravan Park and an 80-acre site in all, has been on the market since July with a price tag of about £13m. Buyers have yet to emerge and whether that is a remotely realistic figure in the current economic climate is open to question. Furthermore, the extent of liabilities such as mortgage defaults is unclear, and so is the status of unsecured Norton creditors as potential beneficiaries.

Finally, the position of savers in three pension schemes, who became unwitting investors in Norton Motorcycles when their funds were controlled by disgraced Norton supremo Stuart Garner as sole trustee, is unresolved. BDO is currently consulting lawyers and may take the view that they were simply shareholders, who lost their shirts to the tune of possibly £12m in total when the business collapsed, and are therefore due nothing.

Obviously Dalriada, an independent professional trustee firm parachuted in by the Pensions Regulator after ousting Garner from his role last year, would disagree. Investigations by the Pensions Ombudsman and Pensions Regulator are ongoing. Sadly, their conclusion may be that Garner is personally liable for the pensioners’ losses, which suggests their chances of getting any money back are slim. 

 

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