Shoreham airport banking on rescue plan
27.11.2008 (Brighton Argus)
The owner of Shoreham airport said it hopes to agree a recovery strategy with
its bankers before Christmas. This may involve the sale of its assets.
Erinaceous looked to have got a bargain when it bought the airport for £8.6 million
from Brighton and Hove City Council and Worthing Borough Council last year.
But now the property group, which has net debts of £210 million, may have to
sell the airport to avoid going through some form of insolvency procedure.
That could scupper major redevelopment plans which include building hangars,
offices, a fire station and an overhaul of the Art Deco terminal building.
Erinaceous said it could not “rule anything out” as it sought to “remove the
uncertainty which has surrounded the company over the past few weeks”.
Last week, the firm parted company with its founders, deputy chairman Neil Bellis
and chief operating officer Lucy Cummings, following pressure from shareholders.
to have been paid off with a year’s salary which they will receive in instalments.
Mr Bellis and Ms Cummings were paid salaries of £395,000 and £341,000 respectively
last year, and were employed on notice periods of one year. That means they are
walking away with £730,000 in severance pay.
Activist shareholder Fursa had called for an extraordinary general meeting to
oust the pair after the company’s share price nose-dived from 400p in spring to
Erinaceous chairman Nigel Turnbull said: “I am pleased that the issues raised
by the shareholders’ EGM requisition have been addressed satisfactorily.
“Over the past two months, we have restructured the board, appointed new corporate
management and strengthened our team of professional advisers.
“The board’s focus now is to complete the strategic review announced at the interim
Mr Turnbull, along with Tim Redburn, a company turnaround specialist who was
drafted in as interim chief executive this month, and Dominic Lavelle, the new
finance director, are now weighing up what to do with the business.
One option will be to put the whole affair into administration.
This might be forced upon them if lenders, which include Hsbos, HSBC and Lloyds
TSB, decide enough is enough and call in their loans.
Erinaceous’s problems began in March last year, when the firm was hit by a multimillion-pound
fraud investigation at one of its subsidiaries, which was quickly followed by
a collapsed takeover bid for the company.
In September, the full extent of the problem was revealed when it admitted to
breaching its banking covenants.