By Cara Sulieman
SCOTS travel giants Globespan went bust despite being owed around £30 million from a credit card processing company, it was revealed last night.
Administrators said they believed a firm called E-Clear owed the firm around £30 million – but about half of it would now be claimed back by stranded customers.
Bruce Cartwright, partner at administrators PricewaterhouseCoopers, said that people who had booked a flight with their credit card would be able to claim the money back.
But for others, including the hundreds of staff, there seemed little hope of anything good emerging from the financial disaster.
He said: “I believe that something like half the amount could be reclaimed. Maybe slightly more would be claimed back by customers.”
However he couldn’t explain why the credit card company had withheld such a large sum of money from the airline – saying only that he expected they were being “more cautious”.
He said: “I’m trying to ascertain why that money is being withheld. My team are looking into it.
“We will investigate it and come back with answers.”
And he denied that it was this alone that had caused the collapse of the Scottish holiday company.
He said: “Two years ago the company accrued a loss of £20 million partly due to trying out new experimental routes that didn’t work out.
“They restructured and in last year made a small profit.
“But suffering a £20 million loss means you need to rebuild the capital.
“That was the problem aside from the liquidity problems that came later.
“There have been liquidity problems – within the last 12 months people who trade with the company are less inclined to give credit because of the financial situation.
“If the money is not flowing in there is no source of income.”
His company was only appointed as administrators on Wednesday night, and Mr Cartwright said that they had concentrated their efforts on dealing with the passengers and employees of the company.
He said: “We were appointed at 5pm last night to Globespan PLC and this morning to Globespan Airways.
“Yesterday the group ceased operations.
“We were not in a position as there are no funds available to pay for the flights and we had no choice but to cease operations.
“We were really focused in the initial 24 hours on dealing with passengers and staff abroad and dealing with employees.
“There are around 650 employees with Globespan, 550 of which were made redundant today.
“One hundred have agreed to stay on and assist with the wind down of the company.”
Talking about the meeting Mr Cartwright had with the employees today (Thurs), he said that they had taken the news with dignity.
He said: “They behaved with great dignity, we had a number of one to one conversations and they behaved incredibly well considering the circumstances.
“I would like to say thank you to them, it has been an incredibly difficult day for them.
“Clearly we have cabin crew abroad it had been a concern how we repatriate them. We have now repatriated a number of employees, those who are not on their way home now will be returning home tomorrow.
“The company would like to say thank you to Virgin who provided free flights for the cabin crew to come home. They have stepped in and really helped the company and the industry.”
Mr Cartwright also spoke about Globespan’s contract with the Ministry of Defence during the press conference at PricewaterhouseCoopers’ office in Edinburgh yesterday (Thurs).
He said that they had stepped back to allow another airline to take over the contract so that there would be no disruption.
He said: “MOD flights are continuing to the Falkland Islands and back.
“We have withdrawn from the contract to allow somebody else to step in. We wanted to make sure that that flight wasn’t interrupted.”
And he passed on a message for the directors of the company, who tried to secure funding from Halcyon Investment to keep the airline going before its collapse.
Mr Cartwright said: “The directors would like to say thank you to the Scottish public for supporting them over the last 35 years and thank you to employees for the effort they have put in.
“They believe they have done everything they could to achieve a more favourable outcome than we have achieved today.”
Just days earlier the company had suggested that support from a firm called Halcyon Investment was on the horizon, and that Globespan had held ambitions to build on the rich history of the company.
Asked about founder Tom Dalrymple, Mr Cartwright said: “I believe he was the majority shareholder and that would have changed with any investment.”
The company has set up two helplines for people who have booked flights with them which are 0141 332 3233 and 0131 466 7612.
Further information can also be found at www.flyglobespan.com.
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