People owed money by the company that planned to take forward the controversial Circuit of Wales project have been told it is still on course to be delivered.
Papers going to a meeting of creditors of the investment firm behind the £430m racetrack near Ebbw Vale say that “significant work” has been put in to get the project “back on track” with the support of “a collection of councils in south Wales”.
The Papers said “The project itself was hit very hard earlier this year when the Welsh Government announced it would no longer support the project. This was unexpected and came as a shock to all.
Since then significant work has been put in by the group to get development back on track with a collection of councils in south Wales as opposed to the Welsh Government itself.
This has been delivered successfully so far as agreements have been reached that allow the project to move forward. Whilst the detail is still being agreed with the councils before funds will become available to commence construction, the new financial structure identifying how creditors will be paid has been agreed.
As a result of this the company will be in line to receive the financial reward for the project that will allow payments of its debts, however this will not happen imminently and it is therefore necessary to secure a formal deferred payment arrangement with creditors.”
However we put the company’s claim to a spokesman for the 10 councils in the Cardiff Capital Region, who said funding the Circuit of Wales had not been discussed.”
The meeting of creditors of Aventa Capital Partners, the investment company wholly owned by Mr Carrick through which the Circuit of Wales was originally intended to be funded, is due to be held on Thursday.
One of the creditors of the firm has served a winding-up notice on the firm which is under consideration by the High Court in Leeds.
To avoid liquidation, the company is asking creditors to approve a company voluntary arrangement (CVA), under which unsecured creditors would receive 45% of what they are owed in 2020, a further 45% in 2022 and the remaining 10% in 2024.
September last year the Welsh Government decided there were too many risks to public funds for the required loan guarantee to be provided. Private sector investors were only prepared to put money into the £430m project on condition that the guarantee was in place, so the likelihood of the project’s proceeding appeared low.
The information in the papers going to the creditors’ meeting is written by Elizabeth Manley, the joint nominee of Aventa. In writing her report, Ms Manley states that she relied on the director’s statement and the financial information it contains in forming her opinion on the proposal.
Mr Carrick has announced previously that if the Circuit of Wales were to go ahead at this stage, Aventa would not be involved.
However, the firm responsible for delivering the project – Heads of the Valleys Development Company – could in such circumstances become able to pay what it owes to Aventa over time, in turn allowing Aventa to repay its creditors.
The amount owed by Aventa totals £2,877,762. A list of creditors shows the largest single amount of £720,000 is owed to Mr Carrick himself. Four individual consultants – Nahid Majid, Marc Templer, Chris Grindal and Robert Porter – are owed a total of £510,000 between them.
Engineering and design firm Parsons Brinkerhoff is owed £414,303, London law firm Stephenson Harwood is owed £396,974 and financial consultants Deloitte are owed £216,917.
HMRC is owed £26,421 for VAT and £2,554 for Corporation Tax.
Among the other creditors is the Financial Conduct Authority (FCA), owed £2,247. Aventa is an FCA-regulated company. Its entry on the online Financial Services Register, administered by the FCA, states: This is a firm that is given permission to provide regulated products and services.”