Llangollen Railway

I know there are no certainties in current circumstances but I would be amazed if serviceable Mk1's fail to find a buyer willing to pay more than scrap value,

Jon

 

A big question would be how many coaches the LR actually needs. The historic carriage survey lists a couple of dozen Mk 1s as being based on the line, several of which are non-corridor examples. They could probably run a decent service with half that many operable examples. Probably the most sought after vehicle on offer will be the line's RMB, but with only one in the fleet it is probably one that they should let go.

 

Agreed. Serviceable Mk1s rarely come onto the market, especially in any quantity. They will be snapped up like hot cakes by other heritage lines and mainline operators.

 

Who do you think would buy them, especially in the current financial climate? OK, no need to name names, but I wonder who amongst heritage railways is looking to expand their fleet?

I might be wrong, but I wonder if they do have to be sold, whether they might not necessarily disappear "like hot cakes" - perhaps a few places might consider taking a better quality vehicle and cascading down one of their own worse or less desirable vehicles out of use, but it feels at least conceivable that putting vehicles like that onto the market may simply result in others elsewhere essentially being scrapped, i.e. a net reduction across the whole sector.

Hopefully some means can be found to keep the Llangollen as a viable entity, which obviously requires some sort of carriage fleet of their own.

Tom

 

The four mk.1’s at Elsecar were snapped up, I understand

 

I wonder if that was to "increase the stock" or "rotate the stock", as it were? Anyway, maybe I am wrong in my pessimism.

Tom

 

I think you are wrong in your pessimism but time will tell.

Looking at the carriage survey website some coaches are listed as being owned by the Plc, some by the Trust and some by other groups. So hopefully enough remain to run a service, but the backbone of the fleet does seem to be Plc owned.

 

Would anyone hazard a guess at what the difference in price between MK1 corridor coaches, TSOs and buffet cars might be?

Looking at the photos they all seem in reasonable condition so this sort of sale might set a benchmark on price for a few years to come.

 

Presumably the receivers will only sell enough to cover the PLC debts and their own costs or will they keep selling things if there is demand?

 

The plc is insolvent, ie it doesn't have enough cash to pay its debts. Now it may be that the assets have a value greater than their book value, but I doubt that they will fetch enough to clear all the debts.

 

In simple terms, and based on my knowledge of the principles which is some years out of date, the receiver is acting for the bank, which has appointed the receiver under the terms of its debenture (fixed and floating charge) over all(?) the assets of the PLC). If the receiver can raise enough funds from assets subject to the fixed charge (I imagine for example the coaches owned by the PLC are subject to the fixed charge) to cover the monies owed to the bank and its costs, then the receiver's job is done, and the rump of the business will I suspect be liquidated by a liquidator. If sales of assets subject to the fixed charge raise insufficient to repay the bank, then the receiver may look at selling assets subject to the floating charge (e.g. debts due to the PLC may fail the test for a fixed charge and be covered by the floating charge) but such proceeds have to be shared with creditors whose claims are classed as preferential. Same ultimate outcome, once the receiver has done all he can / needs to, then the remaining rump will be liquidated during which process any remaining assets would be disposed of.

 

Yes, the bank have appointed a receiver, who will recover the value secured by the charge (and costs) from the charged assets. Anything left in theory could carry on, but in practice will almost always end up in administration or liquidation (administration is brutal surgery where the patient may survive, liquidation is putting a sheet over the patient).

Although deeply unpleasant, it's worth remembering that without this process, the bank wouldn't take the risk to advance the money in the first place.

I would actually venture to suggest that a healthy return on that which can be done without will make it easier to save what is essential - the receiver has a fixed sum to recover, the quicker they get there, the better. The finesse is guiding the receiver to make the money in the least painful way

 

I suspect the price of corridor coaches has gone up in the last 12 months

Jon

 

I'm not going to get involved in speculatively raking over the carcass of the Llangollen PLC, but please don't pay too much attention to who-owns-what on the Carriage Survey site as (based on what I know at other railways) the ownership field on that database is wrong just as often as it is right.

 

I'll second that, it's an excellent source for everything except ownership, where it is decidedly shaky from the vehicles I know about.

 

Looks like with the Dartmoor railway they are trying to sell the whole operation as a going concern to get the best price, if not sold they will sell individual items.
Ideally needs a sympathetic millionare or consortium to buy as a going operation?

 

To the extent that's accurate, that's good news in several ways; fewer to be sold, which will mean the market is less likely to be swamped, so prices will be higher, meaning less chance of them going to a scrapper (although that last may have been unlikely in any event).

Noel

 

As I understand the set up, the Llangollen PLC does not own the assets or rights to operate a complete railway, e.g. as reported on here, the LRO is in the Trust's name, the Trust is party to the trackbed lease from the Council, owns some of the track, owns some rolling stock etc. To what extent the relationship between the two entities was documented in agreements is moot as the PLC is unlikely to play any part in the future. The Trust is the obvious buyer for the PLC's assets, but rather than that creating £££ signs because of the unique "marriage value" to the Trust, they may not have enough cash to do so, and the receiver (and any liquidator or similar) is duty bound to maximise the return to creditors, which they may see as more likely to be achieved through seeking piecemeal disposals. However, I am sure there will be a few twists and turns in the road.