Mining Liquidation no.2
On a previous post we discovered that Peter Lawwell was a Director at Monktonhall Colliery Company Limited which became insolvent and was liquidated in 1997: https://footballtaxhavens.wordpress.com/2012/12/15/peter-lawwell-was-a-director-of-monktonhall-colliery-ltd-when-it-became-insolvent-went-into-liquidation-in-1997/.
Being a glutton for punishment he also became director of another mining company, in fact the Group Finance Director, of The Scottish Coal (Deep Mine) Company Limited from 8/5/1998 until 2/6/2000. Mr Lawwell, after getting burned in the Monktonhall Colliery liquidation, saw the writing on the wall & he got out this time before the company finally went bust. However the company was in very bad straits, as we’ll examine below, when he left the sinking ship and it appears he jumped just before the ship went down. Note below that the last accounts were made up 31/3/2001 and Peter Lawwell left 2/6/2000 so the same tax year he left. In liquidations, retrospective accounts & transactions are examined and with him as Group Finance Director, he should be allocated some blame for the liquidation especially when the last accounts are examined.
Funny, none of the liquidations are mentioned in his Wikipedia entry but then there’s a lot of history revisionism about in Wikipedia.
Analysis of Final Accounts on 31/03/2001
What were the state of the company’s last Accounts? From http://companycheck.co.uk/company/SC180022
On the actual Duedil site under Book Value if the cursor is placed on middle of the graph line it shows a Book Value at 30 Mar 2000, 2 months before Peter Lawwell resigned, at -6,635,000 GBP. At the same point on the Cash graph, the value is Zero. The company was insolvent when he left.
So at 31/03/2001 the business made a Loss of £39 million, Current Liabilities of £29.6 million and it’s book value was £-19,766,000, and the value of their shareholders’ fund is £-19,766,000. Cash in the bank was ZERO. It was bust. No wonder someone was running out the door the previous June. This financial performance was actually much worse. It was later reported that The Scottish Coal (Deep Mine) Co. Ltd., remember a Private company, had received govt subsidies of almost £41 million and yet still it’s accounts were at a mess at 31/03/2001, 9 months after Lawwell left. http://www.themilitant.com/2002/6624/662465.html
Although the final triggering event for the companies liquidation was the flooding of the Longannet mine under mysterious circumstances on a weekend when few miners were underground [none were lost], on Saturday 23rd March 2002, the final accounts were lodged on 31/03/2001, almost a full year before, just 8 days less. On the same Saturday, again very quickly indeed, the mine owner, The Scottish Coal (Deep Mine) Company Limited, entered receivership. Why didn’t the company want to have to submit accounts for the last year? This could have been about covering up the £41 million govt subsidy mentioned above. And as can be seen from the last accounts on 31/03/2001 the company was ‘underwater’ well before.
As in the Monktonhall Colliery liquidation, Brian Wilson, UK Energy Minister and future Celtic director, was involved in trying to find jobs for the 500 miners who lost their employment. Coincidentally, with the Longannet mine closed the former white elephant in Mr Wilson’s constituency of Cunningham North, the Hunterston terminal in Fairlie, North Ayrshire became a key element in bringing coal to the Longannet Power Station. Hunterston terminal was originally created mainly for transporting iron ore for Ravenscraig Steelworks but that closed in 1992 and was operating at low capacity from then on. Another coincidence, where did Peter Lawwell go when he left the mining company? To Clydeport Shipping Ltd & Clydeport Operations Ltd as a Commercial Director, operators of the Hunterston terminal.
Note: Harper McLeod are the solicitors.
And there’s more
500 mining lost jobs, £19.7 million lost shareholders value, £41 million taxpayers subsidies down the drain and lots of coincidences but this wasn’t the end of the story. The next post looks at the aftermath of The Scottish Coal (Deep Mine) Co. Ltd. liquidation and what was discovered.