Chairman’s £32m. claim in £160m. of Long Port debt

LONG PORT GROUP entities owe more than £160m, court papers show.

charlesbillson
Charles Billson

That includes a claim of £32m. from group chairman Charles Billson, while Lloyds Bank International Ltd is claiming in the region of £130m.

Eight limited companies were put into administration and two limited partnerships wound up following successful applications by Lloyds in the Royal Court earlier this month.

Attached to an affidavit that was put before the court from Mr Billson was a copy of a letter he had written to one of the companies, Long Port Properties Ltd, on 2 December demanding repayment of £32m.

Despite its name, Long Port Properties Ltd is the only one of the entities not to own property and represents the employees and operational side of the business.

The debt action has put 15 jobs at risk.

Comments for: "Chairman’s £32m. claim in £160m. of Long Port debt"

100% Donkey

I can only imagine what some of the comments are going to be on here !!

Damn bad luck Charles that LP Properties has no property for you to go after. Good news is you must have had a few earners from the other companies. As for the staff and property owners who will be hung out to dry, one can only speculate.....

John West

I have no idea why this industry is not regulated. This type of thing goes on so often, particularly seen with new builds – house is built, snagging guarantee for 2 or so years and lo and behold the company that provided the guarantee goes into administration and any guarantee goes along with it!

As you say, it's the staff and property owners that lose out whilst more often than not the investors have reaped the rewards for a good long time but occasionally lose out (which is part of the 'game').

carolfromtheblock

Poor bloke

InteresTed

Is this - own some companies then use them to get some money you havent got or am I being naive?

Disgruntled

If he was the chairman how come he didn't know what was going on, he must surely shoulder at least some of the blame for the shambles. Not overwhelmed with sympathy.

Paul

Pretty usual for a major shareholder to try and get in a claim first before the main creditor pulls the plug to claw back at least some of their money. Be interesting to see where he is on the list and how favourably his claim is taken.

John West

Absolutely, this is very common and you can bet your boots his was the first creditor put on the list!

GM

Paul

No, it doesn't work that way. Secured creditors (i.e. Lloyds) get paid first. Other creditors would then usually rank equally with each other and they will get a pro-rata share of what's left, if anything.

What he seems to have done is perfectly normal - instead of putting funds in as capital, he puts it in as a loan. It means that he ranks alongside other unsecured creditors as opposed to ranking behind them, which would be the case if he put in equity rather than debt. Nothing untoward there, unless he has tried to jump the queue to get paid of course.

Paul

That's assuming he didn't have a secured entity created and 'loaned' the company otherwise taxable dividends. It will be interesting to see how his claim is structured and where in line it falls. Obviously in plc companies a strict list is formed starting with HMRC with directors loans near the bottom, how Longport are set up I can't comment.

GM

Paul

Unless his loan was secured by a second legal charge or by a fixed and floating charge (and I've not seen any hint of that), then his claims would rank pari passu with other creditors.

Paul

Agreed if that is the case.

Devil's Advocate

How does one become a 'secured creditor' like Lloyds? In this case the company has virtually no assets, so what have Lloyds used as security?

GM

Devil's Advocate

Of course there are assets! Lloyds had the security of a first legal charge (a mortgage) over multiple sites. But the assets are worth less than the liabilities in a depressed property development market and it couldn't generate enough cash flow from selling completed properties to service the secured debt, so ultimately Lloyds had to pull the plug to minimise their losses.

If you have secured debt of £160m and gross assets of £200m then you're fine. If those assets in a depressed market are now only worth £120m and you haven't got the cash flow to service the £160m secured debt then you are completely screwed.

Insider

Mr. Teflon himself.

John West

You mean after a couple of years his coat starts to wear out and eggs start to stick to him?

Wings

A man in the same mold as Sir Philip Green

MajorMajor

Billson's bill's on at Court. It give's me bile, son.

REGINALD

What is it about 'Guernsey' that attracts the 'Billson type of person'. ? Looking on the bright side, in time, they mostly re-locate elsewhere, or perhaps have their 'funeral' in the Island..! Either way, 'they depart'.!!

REGINALD

Amazing as it appears to me, so Long Port Group Chairman Charles Sydney Billson, is 'holding his hand out' as it were, for a mere 32 MILLION POUNDS. Surely Mr Billson, as Chairman must accept responsibility for the financial difficulties in the first instance. ? His past personal judgements must be the subject of very close scrutiny and explanations. ? It reminds me of a case of 'a very well fed parent, attempting to eat it's own young'.!!

thames

Gotta love this- so predictable! Yet another delusional "property developer" living in a fantasy land bubble about what can be charged for mediocre, bland and substandard yet overpriced flats! Mr. Bilson- you are in Guernsey not Mayfair and your prices for drab and uninspiring flats ( nothing like top developments in London) have been simply ridiculous!