Mezeron & Steam Packet Master Thread

[When Skies Are Grey]

However, for services to be maintained with current fleet, the Portugese Bank needs to be involved as they must have a first priority mortgage charge over both the Ben and the Manannan and then depends what other securities it has?

 

Seems Portugal is fooked too - linkage

[Barrie Stevens]

It's my opinion that under no circumstances should there be a Government bailout using taxpayers money (in any case, is there anything left?!)

 

Whether or not the Government had the power to force owners to sell the IOM operating company (IOMSPC) would be interesting.

 

Presumably, if IOMSPC want to renegotiate the User Agreement, then a condition of the renegotiation would be the sale of the operating company and safeguarding of jobs for a minimum amount of time or payoff?

 

However, for services to be maintained with current fleet, the Portugese Bank needs to be involved as they must have a first priority mortgage charge over both the Ben and the Manannan and then depends what other securities it has?

Corporate guarantees from IOMSPC or another group company?

 

 

They could not force a sale of company/assets (save by seizure and sale through the Admiralty Court)

 

Remember, that companies are legal persons and equal to natural persons under the First Protocol of the Human Rights Act/European Convention on Human Rights and enjoy security as to the enjoyment of their property and possessions and that includes intellectual property.

 

Interference has to be justifiably for the public good and proportionate ie ends justify the means and vice versa. (within the human rights principles) The Government has not reserved powers unto itself in regard to Steampacket assets and what an advert enforcement would be for an Island promoting itself as a free enterprise hub!

 

Regarding ship finance. Ships have marine mortgages and First, Second and Third preferred mortgages often exist over one asset. I do not know the actual ownership company of "the Ben" etc. Many ships are owned/registered offshore. Often the company is offshore and in itself not worth very much. How much is the ownership company of "the Ben" etc worth?

 

The usual practice if the company is offshore and "worthless" is, as you say, a guarantee. Since the 1980s banks have often been insisting on Personal Guarantees from the company Directors (They put their shirts on the line). However, they also insist on watertight Covenants over corporate and personal assets.

 

It is a bit like being a member or "name" at Lloyds of London. Unlimied liability.

 

The IOM Register is a quality register and I think some of the Steampacket ships are Manx registered (?) Personal Guarantees and Covenants may not be necessary. But you get the idea. It is not as simple as that!

[Tugger]

I am going to petition IOM Newspapers to reinstate "Your Shout". Until then ...

 

size="7"]PLEASE GO AWAY [[/size]

[Barrie Stevens]

I am going to petition IOM Newspapers to reinstate "Your Shout". Until then ...

 

size="7"]PLEASE GO AWAY [[/size]

 

 

Go and ask that nice Mr John Wright if he will impose some sort of gagging order or "D-Notice" equivalent! Until then, ENJOY!(PS I have an interest being a Steampacket customer when I travel to and from your Island home)

[Terse]

Energy Link

 

"The Chief Minister doesn't think this is the end for the Steam Packet."

 

That's it! They're doomed!

[b4mbi]

They could not force a sale of company/assets (save by seizure and sale through the Admiralty Court)

Remember, that companies are legal persons and equal to natural persons under the First Protocol of the Human Rights Act/European Convention on Human Rights and enjoy security as to the enjoyment of their property and possessions and that includes intellectual property.

 

Interference has to be justifiably for the public good and proportionate ie ends justify the means and vice versa. (within the human rights principles) The Government has not reserved powers unto itself in regard to Steampacket assets and what an advert enforcement would be for an Island promoting itself as a free enterprise hub!

OK good points.

 

Regarding ship finance. Ships have marine mortgages and First, Second and Third preferred mortgages often exist over one asset. I do not know the actual ownership company of "the Ben" etc. Many ships are owned/registered offshore. Often the company is offshore and in itself not worth very much. How much is the ownership company of "the Ben" etc worth?

 

The usual practice if the company is offshore and "worthless" is, as you say, a guarantee. Since the 1980s banks have often been insisting on Personal Guarantees from the company Directors (They put their shirts on the line). However, they also insist on watertight Covenants over corporate and personal assets.

 

It is a bit like being a member or "name" at Lloyds of London. Unlimied liability.

 

The IOM Register is a quality register and I think some of the Steampacket ships are Manx registered (?) Personal Guarantees and Covenants may not be necessary. But you get the idea. It is not as simple as that!

 

Part of my job is exactly this area.....

 

As at 31/12/2008 the accounts (already linked earlier in this thread) for IOMSPC show that at that time the company was registered owner of Ben-my-Chree (IOM Flag) and Mannanan (IOM Flag) (some c.£22m additions in 2008) and according to my info from an industry subscription website, they both still are. (Snaefell is showing as flagged in Liverpool and registered owner being MIOM1 Ltd)

 

I really don't think directors of IOMSPC or it's holding company MIOM would have been stupid enough to give the bank personal guarantees, in any case I doubt the individual directors would have sufficient assets to cover anywhere near the security level required for c. £200m borrowing.

 

I can't envisage a situation where the bankers have inadequate security, so certaintly they will have first priority mortgages over all of the vessels, then maybe they will have Corporate Guarantee with a group company further up the structure that has sufficient assets or it is possible that it holds an assignment of earnings from the operating company IOMSPC.

 

Certaintly, IOMSPC as it stands is between a rock and a hard place, with its obligations under the User Agreement and its (newly refinanced?) debt to the Bank.

 

I think it will boil down to a question of price, what will / would someone pay for the company, that would minimise losses to the bank, yet secure the service levels/jobs.

[P.K.]

I really don't think directors of IOMSPC or it's holding company MIOM would have been stupid enough to give the bank personal guarantees, in any case I doubt the individual directors would have sufficient assets to cover anywhere near the security level required for c. £200m borrowing.

 

I can't envisage a situation where the bankers have inadequate security, so certaintly they will have first priority mortgages over all of the vessels, then maybe they will have Corporate Guarantee with a group company further up the structure that has sufficient assets or it is possible that it holds an assignment of earnings from the operating company IOMSPC.

 

The directors can easily give personal guarantees. Because it's common practice to let the company carry all directors liabilities. So even if you successfully sued a director the company, and ultimately the shareholders, would be the ones paying up.

 

I'm a bit surprised that the SP reaction has been pretty much non-existent. Is anyone in Oz getting a beasting new sense of direction before acting perhaps?

[La_Dolce_Vita]

how you work that one out

I was told this was the case. But it isn't like some situation where foreign workers in another country are paid less to save costs. These people are coming here. There haven't been any cross-business pay-cuts and these staff members were working prior to shit hitting the fan.

[b4mbi]

The directors can easily give personal guarantees. Because it's common practice to let the company carry all directors liabilities. So even if you successfully sued a director the company, and ultimately the shareholders, would be the ones paying up.

 

I'm a bit surprised that the SP reaction has been pretty much non-existent. Is anyone in Oz getting a beasting new sense of direction before acting perhaps?

 

My understanding of a personal guarantee is that directors guarantee with their own private assets the performance of the company. i.e. if company doesn't perform (on say a loan obligation), the bank can pursue the private assets of the director in order to recover costs as the director has put up his personal assets as a guarantee of performance of the company.

 

Separate issue to what I think you mean which is where the company pays for D&O insurance on behalf of the directors which protects directors/officers private assets in case they are sued for negligence by any of the company's stakeholders.

 

Well, I think some equity shareholders will be about to realise that the value of their shares can go down as well as up

[Nom de plume]

Has there been any comment from Mezeron during the unfolding of this story? Not that there needs be, just curious?

 

I'd be interested to hear from them on how the business is going & whether they anticipate growing their market share?

 

It's nobodies business but theirs of course but wondered whether any snippets had made there way out of Mezeron HQ?

[P.K.]

My understanding of a personal guarantee is that directors guarantee with their own private assets the performance of the company. i.e. if company doesn't perform (on say a loan obligation), the bank can pursue the private assets of the director in order to recover costs as the director has put up his personal assets as a guarantee of performance of the company.

 

How many directors would sign up to that if they didn't have to? I've NEVER known a director lose any of their assets. Even when they were heavily bonused on vapourware the SEC penalised them with heavy fines for shafting the shareholders and the fines were paid - by the shareholders!

[Sean South]

Energy Link

 

"The Chief Minister doesn't think this is the end for the Steam Packet."

 

That's it! They're doomed!

Strangely enough, he was making sense in that statement as was Juan Turner in his statement.

[mountainmile]

They could not force a sale of company/assets (save by seizure and sale through the Admiralty Court)

Remember, that companies are legal persons and equal to natural persons under the First Protocol of the Human Rights Act/European Convention on Human Rights and enjoy security as to the enjoyment of their property and possessions and that includes intellectual property.

 

Interference has to be justifiably for the public good and proportionate ie ends justify the means and vice versa. (within the human rights principles) The Government has not reserved powers unto itself in regard to Steampacket assets and what an advert enforcement would be for an Island promoting itself as a free enterprise hub!

OK good points.

 

Regarding ship finance. Ships have marine mortgages and First, Second and Third preferred mortgages often exist over one asset. I do not know the actual ownership company of "the Ben" etc. Many ships are owned/registered offshore. Often the company is offshore and in itself not worth very much. How much is the ownership company of "the Ben" etc worth?

 

The usual practice if the company is offshore and "worthless" is, as you say, a guarantee. Since the 1980s banks have often been insisting on Personal Guarantees from the company Directors (They put their shirts on the line). However, they also insist on watertight Covenants over corporate and personal assets.

 

It is a bit like being a member or "name" at Lloyds of London. Unlimied liability.

 

The IOM Register is a quality register and I think some of the Steampacket ships are Manx registered (?) Personal Guarantees and Covenants may not be necessary. But you get the idea. It is not as simple as that!

 

Part of my job is exactly this area.....

 

As at 31/12/2008 the accounts (already linked earlier in this thread) for IOMSPC show that at that time the company was registered owner of Ben-my-Chree (IOM Flag) and Mannanan (IOM Flag) (some c.£22m additions in 2008) and according to my info from an industry subscription website, they both still are. (Snaefell is showing as flagged in Liverpool and registered owner being MIOM1 Ltd)

 

I really don't think directors of IOMSPC or it's holding company MIOM would have been stupid enough to give the bank personal guarantees, in any case I doubt the individual directors would have sufficient assets to cover anywhere near the security level required for c. £200m borrowing.

 

I can't envisage a situation where the bankers have inadequate security, so certaintly they will have first priority mortgages over all of the vessels, then maybe they will have Corporate Guarantee with a group company further up the structure that has sufficient assets or it is possible that it holds an assignment of earnings from the operating company IOMSPC.

 

Certaintly, IOMSPC as it stands is between a rock and a hard place, with its obligations under the User Agreement and its (newly refinanced?) debt to the Bank.

 

I think it will boil down to a question of price, what will / would someone pay for the company, that would minimise losses to the bank, yet secure the service levels/jobs.

 

My understanding is the IOMSPC have debts of getting on for £200million. The majority of these debts are bank loans incurred by the current and previous owners in order to buy the company; with very little spent on new plant and equipment.

 

In fact the ships are only valued at around £20million.

 

Which begs two questions; first, "why did the banks agree to lend the money when the company has so little assets relative to the debt"? Answer, because the IOM Gov signed a user agreement giving 25 years of rights to only drive on drive off loading facility on the Island, and that gave IOMSPC what looks like a monopoly on the transport of freight and private cars and bikes. Second question is "who is paying the interest on the loan" Answer, we all are in higher fares and freight charges.

 

Until, IOMSP gives back user agreement (which it clearly cannot afford to do) and another operator with less debt acquires the rights to the drive on/off facilities, we are all in for a tough time and probably higher fares. Mezeron might hurt IOMSPC but I doubt it cannot kill it and end the user agreement.

 

So,how do we stop a mess like this happening again ..... My suggestion would be; we (the IOM Government) buys and owns the ships and then tenders the rights for a commercial company to operate them for say 10 years. If the operating company fails to deliver the service/fare promised or cannot keep up payment for use of the ships, they loose the operating contract. That way our money pays in fares stays in the IOM economy and does not end up in interest payments to overseas banks.

 

What is happening at IOMSPC the same issue as Manchester United and Liverpool Football club .... however, the fans of the reds could always support City or Everton! .... we have nowhere else to go!

[mountainmile]

My understanding is the IOMSPC have debts of getting on for £200million. The majority of these debts are bank loans incurred by the current and previous owners in order to buy the company; with very little spent on new plant and equipment.

 

In fact the ships are only valued at around £20million.

 

Which begs two questions; first, "why did the banks agree to lend the money when the company has so little assets relative to the debt"? Answer, because the IOM Gov signed a user agreement giving 25 years of rights to only drive on drive off loading facility on the Island, and that gave IOMSPC what looks like a monopoly on the transport of freight and private cars and bikes. Second question is "who is paying the interest on the loan" Answer, we all are in higher fares and freight charges.

 

Until, IOMSP gives back user agreement (which it clearly cannot afford to do) and another operator with less debt acquires the rights to the drive on/off facilities, we are all in for a tough time and probably higher fares. Mezeron might hurt IOMSPC but I doubt it cannot kill it and end the user agreement.

 

So,how do we stop a mess like this happening again ..... My suggestion would be; we (the IOM Government) buys and owns the ships and then tenders the rights for a commercial company to operate them for say 10 years. If the operating company fails to deliver the service/fare promised or cannot keep up payment for use of the ships, they loose the operating contract. That way our money pays in fares stays in the IOM economy and does not end up in interest payments to overseas banks.

 

What is happening at IOMSPC the same issue as Manchester United and Liverpool Football club .... however, the fans of the reds could always support City or Everton! .... we have nowhere else to go!

[Tugger]

The directors can easily give personal guarantees. Because it's common practice to let the company carry all directors liabilities. So even if you successfully sued a director the company, and ultimately the shareholders, would be the ones paying up.

 

My God, you are utterly, utterly clueless. What do you think a company's financial state is likely to be if a creditor is calling in a director's personal guarantee? Directors sign personal guarantees when they own the company, in order to be able to get credit, or get cheaper credit. Otherwise, they don't (unless they're stupid). If you were a director, you would probably give personal guarantees whether or not you owned the company.