Meadgate subsidiary change before administration

Mar 14 2008 by Sion Barry, Western Mail

DIRECTORS of an exclusive housing development group changed the name of one its subsidiaries the week before putting the holding company into administration.

As revealed in the Western Mail yesterday, Cardiff-based Meadgate Western ceased trading early this week, resulting in the loss of 50 jobs.

The holding company owes about £4m to creditors, many of which are small and medium-sized business in South Wales.

PwC has been appointed administrators to the holding company which, latest end-of-year accounts show posted pre-tax losses of nearly £1m.

Creditors include Aim-listed PR and marketing company, Freshwater, which is owned £154,000.

Under the holding company around 16 subsidies are expected to be put in administration, although the details of which had not been finalised yesterday.

There has been speculation that the directors of Meadgate Western could make an offer to the administrators to acquire the considerable property and land bank assets of the ceased trading holding company – once all its subsidiary businesses are put through.

However, that would usually be done through a newly created company.

An alternative option could be that one of the companies in the Meadgate Group is not put in administration. Under such circumstance that company could make an offer to acquire the assets of the rest of the group.

However, the administrators would have to consider any offer, or offers, with regard to best value for creditors.

Last week a subsidiary of Meadgate Holdings, Meadgate Home (Ventures) changed its name to VHM96 Ltd.

According to documents held at Companies House the directors of the company remain unchanged as a result of name change, which was registered with Companies House on March 6. They are Chris Edge, James Rodden, Jeffrey Taylor and Martin Taylor.

Latest end-of-year accounts for Meadgate Homes (Ventures), to the end of April 2007, show it didn’t generate any revenues, but incurred administrative expenses of £418,000. In 2005-06 it generated revenues of £3m.

Another creditor of Meadgate is 360 Modelling, a Cardiff-based modelling firm which is owed thousands of pounds.

360 Modelling designs and builds models for housing developers across the UK, including Meadgate.

Its owner Steve Golding said, “I had been fobbed off by Meadgate accounts for the last three months saying payment will be made soon.

“As a small company this is large amount of money to lose.”

No one from Meadgate was available for comment yesterday.

VHM96 is based at Priory House in Usk.

Meadgate has eight ongoing developments, including Wenallt View in Thornhill, Cardiff, and Balmoral Quay Apartments on Penarth Seafront.

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