A holiday park company that was placed into administration is to be sold.
Extra staff have been taken on to keep eight holiday parks in Scotland operating following the £103 million collapse of the company, a new report reveals.
The extent of the debt attributed to Cove Communities Venture 2 Argyle OpCo Limited, the subsidiary established to operate Argyll Holidays, is shown for the first time.
Joint administrators Adam Paxton, Rob Croxen and Ben Cairns, of Alvarez & Marsal, said in the report that they added staff to the complement in Scotland.
There were 97 staff at Argyll Holidays when the company was placed into administration in November, and this was increased to 255 "to ensure we have sufficient staff to support ongoing trading", the administrators said.
They said in relation to the main Scottish sites: "We anticipate that the sale of business process will be launched within the next few months, however the timeline for completion of any transaction is uncertain."
Argyll Holidays was founded in 1967 with the flagship Drimsynie Estate park. Also among the sites are Hunters Quay Holiday Village in Dunoon, Loch Awe Holiday Park, and Loch Eck Caravan Park.
Heart and soul
The company acquired family business Argyll Holidays for £100m in 2022, when director Keith Campbell said: "We as a family have put heart and soul into developing our group of parks.
"Cove is the ideal custodian of Argyll Holidays, sharing as we do, the same missions and values and commitment to the preservation and investment in the destinations we own."
Update reports are not yet lodged with the other entities in administration, Springwood OpCo in Kelso in the Scottish Borders, with 20 workers, and, south of the Border, Gwel an Mor OpCo in Portreath, Cornwall, with 97 employees and one made redundant, and Solway OpCo in Cumbria, with 46 staff.
Administrators said earlier of these sites: “We anticipate that we will commence a sale of business process following stabilisation of the company.”
The Argyle OpCo update showed revenue of £450,140 since November.
Unsecured creditors
The report also showed a total of more than £103m owed. This included £40m owed to unsecured creditors.
The administrators said: “Based on current estimates, it is uncertain whether there will be sufficient funds to enable a distribution to the unsecured creditors as this is dependent on the value achieved for the floating charge assets of the company which will be determined by the sale of business process and outcome from trading.
“This is also dependent on the quantum of preferential claims in the administration, which has not yet been determined as HMRC has not yet submitted a claim.”
The administrators also described events leading to their appointment: “The financial performance of the Holiday Park Silo has been impacted by factors including high interest rates, consumer spending contraction, flooding at the Medmerry site, which is not in administration, and rising costs.
“This led to an inability to continue to service the loan.
“As a result of the above, the group requested the secured lender provide additional funding.
"The secured lender did not agree to the group's request and exercised its powers under its qualifying floating charge to appoint administrators in order to protect value within the company. The company entered administration on the same day.”
The holiday park group administrators also said: “As at the date of appointment, the amount outstanding to the secured lender was approximately £69.8m.
“Based on current estimates, it is uncertain whether the secured lender will receive a distribution as this is dependent on the value achieved from the sale of business process, outcome from trading and associated costs of the administration, in addition to the quantum of preferential creditors who will be paid in priority to the secured lender from available floating charge assets.”
Share