McLean creditors get some cash back

UNSECURED creditors of collapsed property group David McLean will at least see some of the money they are owed by the company, thanks to a £4m tax refund.

The Deeside-based group, which went into administration last October, owed around £72m to secured creditors – primarily the bank – and a further £25m to unsecured creditors.

It was thought that preferential and unsecured creditors would get nothing.

However, a payment of £3.95m from HMRC for a terminal loss relief tax claim meant preferential creditors were paid in full and that some funds were available for unsecured creditors, estimated to be around £1.18m.

The report also shows all of the company’s assets have been sold, apart from a number of “small parcels of residual land” which it said will be realised during the process of liquidation.

“The valuation of the portfolio is unknown however it is likely there is little or no value in this land,” the report said.

Around £52.7m has been paid to secured creditors, following the sale of the group’s assets to its former directors for £51.3m.

But this still leaves a shortfall of £19.3m, according to the latest report from administrators at Deloitte.

The directors, led by finance director John Kendrick, set up Elan Homes and bought the company in November, securing around 90 jobs. Equity and senior debt funding was provided by Barclays Bank.

In an earlier report, administrators said that the downturn in residential property in 2008 had a significant adverse impact on the value of land and building work – the company’s main assets. This, along with a slowdown in the volume of properties sold, put pressure on the group’s cash flow.