Customers
What does ‘going into administration’ mean?
Going into administration means the Company is being taken under the management of an administrator (a licensed insolvency practitioner). The administrator assumes control of the Company from the current directors Administration is one of a number of insolvency processes.
What is an administrator?
An administrator is an officer of the Court and is qualified to manage the affairs of a business when it is insolvent. It is their role to take control of a Company’s affairs when it is in financial difficulty and try to find a longer term solution for it.
The administrators act as agents of the Company and without personal liability.
Who are the administrators?
The administrators are Alison Grant and Sarah O’Toole of PricewaterhouseCoopers LLP (the “Administrators”).
What has happened?
Over recent months myself and my team have been assisting Newcastle City Council (“NCC”), the secured lender in addressing certain financial concerns and reviewing the options available to them arising in relation to the outstanding repayment obligations on the Company's various loan facilities with the lender.
In terms of day-to-day trading, the Crowne Plaza Newcastle - Stephenson Quarter is a highly successful hotel. However, the Company's financial stability has been burdened by its outstanding debt due to the secured lender that related to its original construction and additional funding provided by NCC during the Covid-19 pandemic.
Prior to the appointment of the administrators the Company owed the secured lender £39.5m and it did not have sufficient cash reserves to meet its debt repayment obligations.
All options for recovering the outstanding debt solvently have been explored by the directors of the Company working with the secured lender and other key stakeholders of the Company. Unfortunately a solvent solution was not achievable and this resulted in the directors of the Company taking steps to place it into administration.
A sale of the Company’s business and assets was negotiated prior to the Administrators’ appointment and immediately following the administration appointment the Company’s business and assets were sold to Crossco (1467) Limited (“the Purchaser”), an entity which is wholly owned by NCC. All of the Company’s employees transferred to the Purchaser on completion of the sale.
The new owners will continue to trade the Crowne Plaza Newcastle - Stephenson Quarter and are planning for limited disruption with trading continuing as normal.
Is the Company continuing to trade?
The Company’s business and assets have been sold via a pre-packaged sale to the Purchaser who will continue to operate the business as normal.
What does this mean for my booking?
Your existing booking will be honoured and the Purchaser will be delighted to welcome you to the Crown Plaza Newcastle - Stephenson Quarter hotel in the near future.
What if I cancel my booking?
If you do wish to cancel your booking for any reason, please contact the Crowne Plaza Newcastle - Stephenson Quarter hotel in the first instance.
Can I claim as a creditor?
If the Company owes you money prior to the administration appointment date, you will be an unsecured creditor of the administration estate.
You can submit an unsecured claim for the amount you are owed in to the administration estate.
Further information on submitting a claim into the administration and to download a proof of debt for completion, please visit the Administrators website at www.pwc.co.uk/stephensonhotel.
Based on what we know currently we expect that there will be a distribution to unsecured creditors of the Company via the prescribed part only (an amount set aside for unsecured creditors from floating charge funds in accordance with section 176A IA86 and the Insolvency Act 1986 (Prescribed Part) Order 2003). It is too early to give an indication as to what the likely level of return for unsecured creditors will be.
If you have any further queries, please email uk_stephensonhotel_creditors@pwc.com.
