Defunct Weekly unable to pay £85,000 of debts to creditors

The defunct Shetland Weekly enterprise will be unable to meet around £85,000-worth of debts to creditors, according to a report from the liquidators.

Keith Anderson of Baker Tilly, which was appointed as liquidator when the short-lived newspaper venture was wound up in the summer of 2005, recently wrote to creditors confirming that claims totalling £9,575 in arrears of pay and holiday pay to employees have been received from eight parties but that it is “not anticipated that a dividend will be paid”. Likewise, no dividend is lik­ely to be forthcoming for 26 ordinary creditors to a value of £75,642.

Debts owed to the company, set up by a consortium of local business­men to rival The Shetland Times, totalling £17,630 were recovered – several thousand pounds short of the estimated state of affairs it submitted four years ago.

The liquidator is likely to be remunerated to the tune of just over £7,000. Around £10,000 in employee wages was paid by the Inland Rev­enue but that still left several mem­bers of staff, as well as freelancers and other suppliers, out of pocket.

Receivers were called in after Aberdeen Journals cancelled a contract to print the newspaper because of non-payment of bills and publication was ceased after only nine issues. A raft of cash flow problems because of a long start-up period and a mass walk-out of senior editorial staff in advance of publication led to the company making a loss of £168,000, including £96,000 invested by shareholders, during its short existence.

The shareholder directors were company secretary John Waters, interim chairman John Goodlad, Steven Goodlad, Cecil Hughson, Norman Leask, managing director Maurice Mullay, James Nisbet, Mike Sage, Charles Smith, Tom Stove and Millgaet Media owner Malcolm Younger.

The liquidator’s report said a return had been submitted to the Department of Trade and Industry in accordance with the Company Dir­ect­ors’ Disqualification Act 1986.

Mr Younger was one of the main driving forces behind the venture, which replaced monthly newspaper The Shetland Post when it hit the news stands. He now publishes the successful monthly community magazine ii Shetland and sister publication ii Orkney.

=================================

Correction We have been asked to point out that while John Waters was a shareholder and company secretary of Shetland Weekly Ltd., he was never a director. Apologies for the error. 20.11.09