Report lifts lid on Wrights Group debts of £60m in wake of collapse
Creditors of Ballymena bus builder Wrights Group are owed a total of £60m with the majority likely to receive no more than 3% of what they're due, it has emerged.
The Wrightbus owner had been in business for over 70 years and had been best known for its Transport for London contract for red double-decker buses.
But the group company Wrights and four other related businesses collapsed into administration in September after trading problems.
And while the Wrights name is back in the bus business after most of its assets were sold to Bamford Bus Company, the administration process for sorting out debts of the old companies goes on.
Wrights Group's main lender, Bank of Ireland, is owed £38m, according to administrators Deloitte.
A statement by Deloitte lodged at Companies House said that of all creditors, just economic development agency Invest NI will be repaid. It's owed £2.5m for a loan given when the company was trying to find a buyer to stave off its trading crisis.
Hundreds of unsecured creditors, many of them small suppliers, are owed £20.6m. Deloitte said that under insolvency law, there would be just £688,000 in total available to pay the unsecured creditors. That is 3% of the total they are owed.
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The report also reveals the escalating losses faced by Wrights Group, with a loss of £19.5m in the first eight months of the year - compared to a loss of £13.5m in 2018. Sales were also steadily declining, from £212.6m in 2017 to £103.8m in 2019. The administrators said: "This is primarily driven by a decline in the UK bus market and the group not being able to replace the significant TfL contract which completed in 2018."
Bank of Ireland would not comment on the extent of its exposure to the company's failure. "We do not comment on individual customer matters," a spokeswoman has said.
And despite the cost to creditors, the administrators said the best outcome had been achieved. "The Bamford Bus Company Limited (BCCL) offer represented a significantly better outcome for creditors than in a break-up scenario," the statement said.
The administrators' statement reveals that BCCL has paid £3m upfront for business records, customer list, goodwill, intellectual property, motor vehicles and other assets.
Then it's to pay another £3m in proceeds after it sells some finished buses. It's also to act as agents in relation to collection of debts of the companies.
The five companies which are in administration are owed around £9.3m, with the bulk owed to Wrightbus at £8.7m.