What options are available to directors now?
Founded in Birmingham by James Lansdowne Norton in 1898, the company has produced thousands of motorcycles. As well as producing such notable models as the Commando and the Dominator, Norton bikes also featured in feature films including The Motorcycle Diaries and most recently, in Spectre when James Bond himself rode a Dominator.
They also produce racing bikes which have featured in the Isle of Man TT races since its inception in 1907 – the winner of the first race, Rem Fowler, was riding a twin cylinder Norton.
The company is still based in the midlands, near the Castle Donington race circuit.
As well as the manufacturing side of the business, the Priest House Hotel also in Castle Donington was owned by the company and is also included in the administration.
It was bought by current owner and CEO Stuart Garner in 2008 who looked to build both the manufacturing and racing divisions of the company. They received several high profile, government-backed loans and grants since then but ultimately it’s an unpaid amount to HMRC that has burst their tyres.
The company owed HMRC £300,000 which they claim was covered by outstanding research and development (R&D) tax relief which was owed to the business.
Administrators say that their job is to “determine and execute the most appropriate strategy as swiftly as possible to protect creditors’ interests, bearing in mind the need to minimise distress to all parties.”
It’s a worrying time for several customers who have placed expensive orders with the company for bikes that have not been delivered despite full payment up front.
The Pensions ombudsman is also hearing a case against the company in February, bought by 30 complainants who “concerning the trustee’s (Mr Garner) failure to action members’ requests to withdraw their monies from three pension schemes of which Mr Garner is the sole trustee and the funds of which are also all invested in Norton Motorcycle Holdings Limited”.
Garner said: “I’m devastated at the events over the last 24 hours and personally have lost everything. However, my thoughts are with the Norton team and everyone involved, from customers, suppliers and shareholders at this truly difficult time.”
Chris Horner, Insolvency Director with BusinessRescueExpert said: “Sadly having a well-known brand with a storied history is no defence against the realities of outstanding tax arrears.
“Goodwill towards the brand could be an advantage when it comes to looking to sell the business as a going concern if possible, otherwise it could also generate interest amongst motorcycle and movie enthusiasts looking to own a piece of history if the company is ultimately sold off to fulfill what’s owed to outstanding creditors.”
Anybody can look like a movie star when they are riding along a dry road in sunny conditions but riders will tell you the most dangerous conditions are when the weather changes and the roads start to get wet with the first rainfall.
It’s the same with companies. If it’s starting to feel like things might be about to get out of control then reach out to the experts.
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