Welcome to Yorkshire creditors face losing £1m as liquidation process begins
An update from administrators Armstrong Watson on placing the region’s former official tourism agency into liquidation states that unsecured creditors are set to receive 40p in the pound - slightly down from the 43p in the pound that had been expected when an initial calculation was made in April.
Unsecured creditors are collectively owed £1.8m, with the largest being the North Yorkshire Pension Fund with a debt of £1.49m.
Under the current calculation, unsecured creditors will only collectively receive £720,000 - leaving a shortfall of £1.08m.
The fund alone would only receive £596,000 - leaving it with a shortfall of £894,000.
The liquidation process may take up to a year to conclude, with matters that need to be settled before money can be repaid to creditors including dealing with £10,600 believed to belong to the Welcome to Yorkshire Charitable Trust, refunding advance payments made by WtY members and confirming the final rental invoice for the company’s offices in Leeds.
Gary Fielding, the treasurer to the North Yorkshire Pension Fund, Gary Fielding, said the “unfortunate” situation will not result in any council having to pay more into it.
“The North Yorkshire Pension Fund has been carefully managed and will continue to be so,” he said.
“Due to this financial diligence, the latest assessment showed that there are currently £900 million of assets above the obligations of the fund.
“While any situation such as this is unfortunate, the pension fund, which currently stands at approximately £4.6 billion, will be able to service its obligations.
“It remains in an extremely strong financial position, so contributors can be confident it is robust now and in the future.
“We have remained in discussions with the administrators of Welcome to Yorkshire, and we are committed to ensuring that we can recover the maximum amount of money possible.
“Any shortfall will be countered by the additional money that is available in the fund. No council which is a member will have to pay more into the fund.”
Welcome to Yorkshire’s central assets were purchased earlier this year for £370,000 before VAT, while an online auction of office equipment and items belonging to the tourism agency raised £9,000.
Administrators Armstrong Watson are to be paid £233,365.
Welcome to Yorkshire held more than £1m in cash at the time of its collapse at the start of March following council leaders deciding they would no longer provide public funding.
While e-commerce agency Silicon Dales has purchased key company assets such as its brand name, social media accounts and yorkshire.com website, the existing company which run Welcome to Yorkshire is being wound down.
Silicon Dales has announced its intention to continue to operate the Welcome to Yorkshire brand under a new York-based company called Yorkshire.com (International) Ltd.
In April, a statement of administrator’s proposal revealed HM Revenue and Customs was among those owed money by the original iteration of Welcome to Yorkshire.
The report said HMRC, which is owed £296,000 by Welcome to Yorkshire for unpaid tax, is to receive £290,662 of that sum back in full after being listed as a preferential creditor - with the remaining £5,453 falling under the ‘unsecured creditors’ scheme.