The sale of planes owned by collapsed Dundee firm Tayside Aviation has raised almost £500,000 to pay creditors.
After the historic flight school’s demise in April, administrators attempted to find a buyer for the business. But with no buyer forthcoming, a ‘piecemeal’ sale of assets then took place.
Former owner Tony Banks – who previously said he lost £3 million in the business – has now been established as a preferential creditor.
A new report from administrators states that, following legal advice, his floating charge is worth £110,000.
However, they are not recognising a claim for an unspecified sum from a business he controls, ARB (Scotland) Investments Limited, as a preferential creditor.
Sale of Tayside Aviation planes
The report also shows a total of 10 planes have been sold, raising £495,000.
The report by administrators Geoff Jacobs and Blair Nimmo at Interpath Advisory, says two “scrap” planes have recently been sold.
It adds they are in negotiations with an interested party over Tayside Aviation’s final two planes, both non-operational.
The report states: “We will provide an update on the sale of these aircraft in due course but at this time do not consider the level of realisations likely to be achieved from these sales to be material.”
An initial report published in August revealed the first money was paid out to Royal Bank of Scotland, which held a charge over the business.
Findings of floating charge investigation
Meanwhile, administrators issued an update on financial moves by Mr Banks in the run-up to the firm’s demise.
Companies House records show floating charges were filed in the weeks before Tayside Aviation’s collapse in favour of Mr Banks and ARB (Scotland) Investments Limited.
Previously we reported administrators were investigating the legality of these charges.
However, the new 31-page document states: “We sought legal advice on the validity of the charges held by Anthony Banks and ARB (Scotland) Investments Limited due to the close proximity of the registration dates of the charges and the insolvency of the company.
“The legal advice obtained states that the charges applied to any funds advanced to the business after the date the charges were registered.”
As a result, the report states Mr Banks is due £110,000, while ARB (Scotland) Investments Limited does not have preferential status.
The report adds: “Based on the information currently available, we anticipate that there will be a dividend to Anthony Banks under the floating charge. The quantum and timing of this remains unknown.”
Mr Banks previously outlined plans to take legal action against the couple form which he bought the business in 2021.
A spokesperson for ARB Aviation said: “We continue to work with the administrators and other creditors.
“While the process is ongoing, it is not possible to comment in detail on specific aspects of the administration.”
Outlook for former workers and students
Tayside Aviation’s collapse left students studying at the historic flight school thousands of pounds out of pocket.
The report says the students, who rank as unsecured creditors, may receive a “nominal dividend”.
It adds: “This is fully dependant on the final asset realisations and costs, together with the level of any HMRC secondary preferential claim.”
More than 20 workers were made redundant when administrators were appointed.
The report states that former workers are ‘ordinary preferential creditors’ and estimates their claims to be £34,000.
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