Welcome to Yorkshire creditors set to lose out on over £1m, proposals reveal

An administrator’s proposal has revealed only half of the company’s £2m debts are due to be repaid.

Most of those owed money, including the North Yorkshire Pension Fund, will receive less than half of what they are owed and are being offered 43p to the pound.

The 38-page report also shows Welcome to Yorkshire’s central assets were purchased 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 more than £230,000 for their part in the sales process.

The company 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, yorkshire.com website and rights to the Tour de Yorkshire race, 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. A revamped and updated website is to be launched towards the end of August.

The report by administrator Rob Adamson said the offer from Silicon Dales for the WtY assets was "much higher than any other offer". The sale went through for £370,000 prior to a VAT payment of £74,000 being added - including £239,000 for WtY's intellectual property, £110,000 for merchandise, £18,000 for contracts, £2,000 for computer equipment and £1,000 for Tour de Yorkshire assets.

As a result of the sale, plans for reimbursing some of the debts owed by Welcome to Yorkshire at the time of its collapse have now been put forward.

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 it is owed falling under the 'unsecured creditors' scheme.

Unsecured creditors are collectively owed £1.8m but there is only £779,772 available to pay them - meaning they are being offered 43p in the pound.

The North Yorkshire Pension Fund is the largest unsecured creditor with a debt of £1.49m, while the landlord of Welcome to Yorkshire's former offices in Leeds is owed £188,000.

An estimated £96,000 is owed to former WtY employees, with a further £48,000 due to businesses listed in the proposal as 'trade and expense creditors'.

While a return of 43p in the pound has been indicated as what will be returned to unsecured creditors, the report warns that "at this stage there are a considerable number of variables which will have an impact on the final return to creditors".

Support The Yorkshire Post and become a subscriber today. Your subscription will help us to continue to bring quality news to the people of Yorkshire. In return, you'll see fewer ads on site, get free access to our app and receive exclusive members-only offers. Click here to subscribe.