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Monday, 1 August 2016

Margate Dreamland stays open despite £8.34 million debts & inquiry call

Margate’s troubled Dreamland Amusement Park will remain open for the rest of  2016 summer season despite its operator, Sands Heritage Ltd  owing an estimated £8.34 million (see administrators report page 30-32 for list of creditors)  and calls for an independent inquiry. The company operating the park is then likely to be sold off over the winter period to realise its assets and pay off some of its debts.
In a report to be presented to a creditors meeting on 4thAugust administrators, Duff and Phelps, have stated that although “A sale of the business and assets of the company is likely to be the eventual outcome, an immediate sale is not being pursued” and that the administrators “are therefore continuing to trade the business during the 2016 summer season”( see page 46 of administrators report Sale Of Business) Duff and Phelps hopes that by continuing to trade throughout the summer season it  “will add to value to the business and assets of the Company, so that when a sale is agreed it is likely to maximise realisations for creditors as whole” (see administrators report page 9 paragraph 5.8).
Creditors can however disregard the advice of the administrators at their 4th August meeting,  and agree instead to the liquidation of Sands Heritage and the realisation of its assets, but this is thought to be unlikely.

Responsibility for what former Thanet Councillor, Ian Driver describes as a “monumental mess-up” appears, according to the Administrator’s report, to have been caused in part because of Thanet Council failed to deliver or complete several important features and elements of the park in time for its opening on 19th June 2014 including -  
·       Building works which should have been completed by freeholder Thanet Council, prior to the opening of the amusement park on 19 June 2015, were delayed costing Sands an estimated £2million in construction costs
·       The partial closure  of the Amusement Park during the peak season months of June and July to facilitate the completion of the overdue works.
·       The late delivery (5 months)  by Thanet Council of the amusement park’s key visitor attraction, the iconic Scenic Railway
·       The delayed provision, by Thanet Council, of a number of rides which were supposed be operational on the opening day and the subsequent costs incurred by Sands Heritage, in hiring replacement rides
·       Further delays in the handover, by Thanet Council, of areas adjacent to the park

Although Thanet Council agreed an out of court settlement of over £900,000 for its performance failures, the administrators ague that because of the problems caused by the council  Sands Heritage “was unable to build up sufficient working capital during summer 2015 to cover the costs of operating  through the winter period” ( see paragraph 3.4) and this why the company was ultimately forced into administration.

Said Driver “its now becoming clear that part of the reason why Sands Heritage is in serious financial trouble is because of Thanet Council’s massive incompetence in managing the Dreamland project. This incompetence has cost taxpayers millions in compensation payments and extra costs which could have been avoided had senior managers and politicians done their jobs properly. There should now be a public inquiry to determine what went wrong and why,  and those responsible named and shamed”.

The Administrators report to creditors can be found here


1 comment:

  1. Another fine mess brought to you by Thanet District Council of Numpties. Welcome to Planet Zombie