Companies which were owed a total of £294,000 by the former Shetland Catch subsidiary Shetland Smokehouse when it failed four years ago are to receive only a tiny fraction of what they are due.
Shetland Catch put its Skeld-based smokehouse company into voluntary liquidation in 2006 but its affairs are only now being concluded. Aberdeen-based liquidator Michael Reid of Meston Reid & Co has told creditors they will shortly receive £10,807 between them, which represents just 3.7 pence for every pound they are owed.
The biggest creditor, due over £176,000, was Shetland Catch itself and it will take the biggest hit, receiving only about £6,495 back.
Nine other Shetland-based companies and organisations are owed money, the main ones being the SIC (owed £2,137), Shetland Seafood Quality Control (£1,453) and Shetland Transport (£1,207).
While most of the creditors outwith the islands lost less than £10,000 the two big losers are The Insolvency Service in Edinburgh, owed over £49,000, and Scottish Sea Farms, due over £27,000.
The liquidator raised nearly £94,000 from the sale of assets, including the smokehouse name and website to Scottish company Cluny Fish, which quickly resurrected the brand and took over the community-owned factory until it ran into trouble too.
After payments for wages, legal fees, corporation tax and other costs the liquidator was left with nearly £75,000. The Bank of Scotland will get £28,226 of that because of its position as the lender with security over the company’s assets. For his work Mr Reid will be paid a fee of £35,000 plus VAT, set by the court in Lerwick.
The share available for creditors amounts to £10,807. The money is due to be paid out in early August, provided no creditors appeal against the proposed payout.
A final meeting of Shetland Smokehouse creditors is to be held on 26th August at Meston Reid & Co’s offices in Aberdeen.
Seventeen jobs were lost when Shetland Catch failed to make a success of the business it bought in 2004 from the founders, Dave and Debbie Hammond. The company sold smoked fish, marinated fish, soups and pates to customers around the world.
Shetland Catch blamed rocketing salmon prices for causing customers to cancel orders. Towards the end it was losing up to £50,000 a month.