Bridging lender creditors lose out
By Bridging Loan Directory -
Unsecured creditors who were owed more than £4m by bridging loans firm Catalyst Securities are not likely to receive any payment, according to a report by administrators KPMG.
The Manchester-based company owed more than £10.6m to secured lender Barclays as secured creditor, while NatWest bank also held a debenture over the company’s assets as it was owed £543,904.
The £4m owed to other creditors included £434,558 to trade creditors and £381,924 to Her Majesty’s Revenue & Customs.
However, a report by joint administrators Brian Green and Paul Dumbell of KPMG states that once the proceeds of all of the company’s assets are collected there is unlikely to be enough money available to repay Barclays in full, which means NatWest and other creditors are not likely to receive any payment.
By the time it was placed into administration in May last year, the company had 14 outstanding loans on its books – all of which were in default.
Administrators have since sought to take control of the assets on which the loans were secured, with Law of Property act receivers appointed on seven properties in England & Wales, and five in Scotland where it was appointed as Mortgagee in Possession. The other two properties remain the subject of litigation proceedings.
A buyer was found for Crawfordton House – a 19th Century country house in Dumfriesshire, Scotland, but the deal subsequently fell through and adniinistrators have said they may take legal action against the reticent buyer.
It is now being offered to others who expressed an interest “to ascertain whether a quick sale could be achieved”.
Offers for another property on Paisley’s high street were all refused for being too low. Most of the other assets are development land.
The report also states that the administrators are taking legal advice on whether to pursue a claim against an advisor who had previously valued an asset for for the company, stating there is “potential grounds for a negligence claim”.