HNP continues battle to keep its site in Lerwick

An online petition to save long-established engineering firm HNP gathered over 1,100 signatures in five days as the public got behind the company that has provided marine engineering services to industry and the local authority since 1967.

But Slap, the property company that has started legal proceedings to evict HNP, said the firm’s owner Ian Walterson had turned down many opportunities for help in finding a new home for the business.

Slap, as a subsidiary of the Shetland Charitable Trust, is in business so that it can gift aid its profits to the trust, which has been heavily criticised recently for cutting back its charitable funding.

Slap is in the process of selling the Commercial Road site to Chester-based construction firm Cityheart, which intends to build accommodation for Shetland College students. Cityheart’s bid for the site is understood to be around £100,000 more than that from the HNP.

Cityheart won a £44 million contract from the University of the Highlands and Islands in the summer to build student accommodation at various colleges in the area, including Shetland College, which is part of the UHI.

Mr Walterson said he was very encouraged with the level of support shown by the public to his company, whose 16 employees, he said, stood to lose their jobs if HNP was evicted.

Slap stated on Monday that the offer to assist HNP find new premises remained on the table. And claims that its actions had placed the future of HNP in jeopardy were “mistaken”.

Slap chairwoman Susan Groat, in a press release issued through PR company Platform Shetland, stated: “Since Slap issued notice to HNP of the termination of their lease, Slap together with the David Adamson Group has spent a number of months trying to assist Ian Walterson with relocating his business.

“We put forward five sites initially plus a further site recently for him to consider. Two of those sites were bespoke.

“Unfortunately Mr Walterson chose not to investigate any of them, saying that he ‘didn’t want to move’ and that he had been looking for a site for 19 years.

“Our offer of assistance to Mr Walterson to relocate to suitable premises still stands.”

Ms Groat emphasised that as the board of a private limited company, the directors of Slap were responsible under company law for the proper corporate governance of the company and that merely selling an asset for a “reasonable offer” would not adhere to that.

She stated: “This site is a complex site to value and therefore there is no, single valuation – it depends on what the potential purchaser is going to use the building for.

“A number of offers were on the table at the closing date. The board considered those offers and sought clarity on some points before making a final decision and informing the bidders of the outcome.

“The board made a robust, informed decision based on the facts at the time, which are not for public disclosure, as with any other private limited company.”

In the last three years Slap had transferred around £7 million to the charitable trust for the benefit of many people in the isles, Ms Groat added.

The Shetland Times attempted to speak to Ms Groat personally on Tuesday but she declined and referred all enquiries to Paul Riddell of Platform Shetland.

Mr Walterson said three of the sites put forward by Slap were actually vacant plots that were near Shetland College and it would have made more sense for these to be used for college accommodation.

He said: “The two bespoke sites are currently occupied by other companies and they were not bespoke in relation to HNP requirements: one was too small and the other would have needed a lot of alterations.

As far as building a brand new premises on a green field site went, Mr Walterson said: “It would be reckless of me in my duties as a director of HNP to enter into an arrangement that started a financial burden for this company that would be difficult to service and maintain.”

Three years ago Slap became a private limited company with directors who are independent from the charitable trust in order to comply with charity regulations.

Slap’s board, consisting of Ms Groat, surveyor Michael Thomson and former councillor Bill Manson, makes regular reports to the trustees.

Ms Groat, who was appointed to Slap in 2012, is at present a director of 13 active companies, including being the sole director and owner of Financial Solutions For Property Limited, a firm that has been paid £117,786 in consultancy fees and expenses by Slap over the past three years.

Slap’s latest annual report states her firm as being paid £39,159 in the year till April, £61,067 the previous year and £17,560 in 2013.

This newspaper understands that the arrangement is to be reviewed by Slap.

Mr Thomson said that Ms Groat, a Shetlander who now lives in the Edinburgh area, had done excellent work for Slap and offered “excellent value for money” for the way the company was run.

He said that she had effectively turned Slap around since joining, and many private companies could learn from its efficient and effective operation.

Meanwhile MSP Tavish Scott questioned if the UHI should be effectively funding the demise of a local marine engineering firm which employs UHI students from NAFC Marine Centre.

Mr Scott said that the Scottish government’s private finance (PFI) model was “totally wrong in principle” and would see ownership of the building and the land plus maintenance contracts falling into private hands.

He said that it was in the charitable trust’s remit to act in the best interests of the people of Shetland and questioned if Slap’s sale of the land to Cityheart could conform to that.

The Shetland Times attempted to speak to charitable trust chairman Bobby Hunter but was told by his wife Mabel that he was on holiday and would not be speaking to the press.

• For more background details see tomorrow’s edition of The Shetland Times.