Thanet Star

The staggering truth about Gloag's Manston deal

Lufty Jumbo Jet

Have we been the victims of fraud and misdirection over Manston?

Based on research that we have been carrying out here at Thanet Star it really does look like the idea was to force the council to buy the airport all along.

What we have uncovered is only a pattern of behaviour between two very powerful companies but one that is so striking it is hard to ignore. The evidence suggests that maybe Manston Airport was part of a debt swap and dump and it might not be the first time that these companies have been part of such an action.

Manston Airport

In 1998 the existing owner sold Prestwick Airport to our favourate Scottish transportion company - Stagecoach Group [source]. Stagecoach then went on to sell the airport to Infratil in 2001 [source].

The same Infratil owned Manston Airport and then sold it to the Stagecoach Group's owner Ann Gloag in almost the exact same way last year.

But the uncanny similarities do not stop there.

When Infratil owned Manston airport it loaded it with debts and handed off to Gloag's company. Likewise when Gloag's Stagecoach Group owned Prestwick Airport it too was loaded up with debt before sale.

Prestwick was taken off of Infratil's hands by the Scottish Government who renationalised the airport and presumably took care of the debt.

Now it looks like our local authority will end up taking the airport off of Gloag's hands and take care of that debt too.

Is this less a case of Gloag's revenge and more the second half of a complex conspiricy to squeeze free cash from government?

If you are prone to see cloak and dagger in business opperations then you probably do not need to know that Stagecoach New Zealand is a wholly owned subsidiary of Infratil Limited. Stagecoach New Zealand was part of the British Stagecoach Group as owned and operated by Gloag and her brother. Infratil then bought the firm from Stagecoach in November of 2005 with permission to use the name and livery for five years after the sale.

It looks like this sale happened after Stagecoach built up debts on Prestwick Airport by borrowing money that they spent elsewhere and then sold the airport and debt to Infratil who handled the airport off to the people of Scotland.

Infratil look like they have likewise taken out loans (free money) and are trying to hand the debt to us via Stagecoach. Probably legal but not at all ethical.

I wondered before why the normally compitant business woman Gloag gave up so quickly. Did she always intend to trick Conservative MP Sir Gale into brokering the sale?

This implication would explain why Gloag, whose companies are known for aggressive expansion and competition, never seemed to make much effort to make the airport profitable. It also might explain why the sale price was 1 if the sale was in order to allow Ann to act as an arms length intermediary for the sale of Manston to Thanet District Council.

There is a clear and cooperative business relationship between the two companies (Infratil and Stagecoach Group) and one has to wonder if Gloag never intended to build houses but wanted to compel the local authority to buy the airport by leveraging public outrage and have the authority take over Infratil's carefully created debt in the same way as it looks like Infratil have already done for Gloag.

The problem for us now is that if we call for a serious financial fraud investigation into the two companies Manston could be in limbo for years. However it might be possible for TDC to make the purchase and then to sue the two giants for the sum of the debts that they loaded onto it. Assuming of course that they can muster the legal muscle to pull of such a feat.

Which makes forcing a sale of the airport to the public purse for a million or two much safer than selling for seven million to a company with the power to come after Gloag and her friends when the scale of the debt that comes with the airport now comes to light. After all governments have funds to bail out and write off debts that Stagecoach and Infratil have created but not the will nor the shareholder pressure to come after the debt makers.

In all honesty there might be nothing we can do to stop Gloag and Infratil hugely profiting from loading debts onto assets of this size.

Of course some of this is conjecture and there is no evidence that we have of actual illegal activity. Tell me I a wrong but this does look like a giant debt swap with Thanet (and the Scottish government) as the losers.

Does this look dodgy to you?

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Public Comments

This Insightful Golden comment was left by Eastcliff Richard [score: 4]:

Whilst I am not myself averse to conspiracy theories, there are often far more mundane explanations. For example, if Souter/Gloag and Infratil have done business in the past, it's probably only natural that they would do business with each other again in the future. I agree that the debt offload looks a bit fishy, and it's only recently come to light. Probably more to come on that. But if they were looking for a public body to bail them out with taxpayers' money, they must surely have been aware that TDC was the last place they'd be able to find a suitable begging bowl. TDC are skint. They haven't got enough money to buy a Lego airport, let alone a real one. Gloag isn't stupid, she must have known that.
28/05/2014 16:25:25

This Normal comment was left by Matt B [score: 0]:

You have a good point that these two firms are probably good friends in the business world but I stand by the assertion that it looks dead fishy. You might even be right that there is nothing evil going on but it does look like...
28/05/2014 16:36:50

This Insightful Golden comment was left by Maffi [score: 4]:

What an understatement Matt B They seem not so much as friends but an incestuous family who are working the system to defraud the public.
28/05/2014 16:58:15

This Informative Normal comment was left by Ian Connor [score: 3]:

I think what Gloag is upto is more nuanced than that. I believe the following plan is being followed:

1. Gloag off loads debt to "Manston Skyport" with the aim to make it look less profitable than it was - ie the whole 10,000 losses per day bit.

2. By showing unsustainable debt she can wind up the company and show this as a loss in her accounts - this then means she gets a tax break and probably a not insubstantial one!

3. The airport is wound up and staff made redundant. Then assets can be sold off to the highest bidder.

4. The final part is selling to developers after upping its value through controversy and rejected bids like Riveroaks.

Gloag therefore extracts value at every stage of the process and thus maximises her profits.
28/05/2014 17:33:18

This Normal comment was left by Gollum [score: 0]:

This is a complete load of tosh. Infratil bought the airport in 2005 for 17 million. At the time, Steve Fitzgerald anticipated that they would invest 9 million of capital and make losses of 10 million in the first three years. In other words, they were losing over 3 million per year. At a conservative estimate, in the 8 years they owned it, Infratil spent a total of 50 million on the airport, so, it is patently absurd to suggest that they have "loaded the airport with debt." In fact, if the debt figure is 23 million I would suggest that Infratil has not transferred all of the debt it accrued whilst they owned it. The debt associated with the airport is entirely attributable to the airport and should rightly be transferred with it if it is being sold as a going concern. There is nothing improper in doing this and it explains why Ann Gloag was able to purchase it for just 1. She is entitled to try to recoup this debt and anybody wishing to buy the airport site from her will need to offer at least 30 million. This is way in excess of what RiverOak was offering and so, I can't understand why it was being suggested that they had offered the asking price. There wasn't an asking price and, if there was, it would have to be much, much higher than the figure they came up with.
28/05/2014 17:59:44

This Helpful Normal comment was left by Mrs Tara Plumibing [score: 2]:

I enjoyed your account of things no end, It reads like a summary of a Shakespeare farce. I'd like to watch it played out at the Theatre Royal.
But really I think there is a lot of truth in what Gollum wrote. I don't remember the facts and couldn't be bothered to look them up but his story does ring true to what I recall reported over the past decade or so.
Much as I joke about selling an airport for a there was always the debts/ investment connected to the sale as well.
28/05/2014 22:27:00

This Off Topic Hidden comment was left by Richard [score: -3]:

29/05/2014 08:50:35

This Helpful Normal comment was left by Tango and Cash [score: 2]:

Have to say, Gollum seems to have summed this up nicely.

All the story here shows is that 2 companies carried out business together on more than one occasion.

A simple cursory glance at this situation would seem to show the assersions made above are weak at best. Just one simple difference makes clear that the already tenuous links made have little if any credance.

Simply, TDC has no money (does any UK council?). Thus paralells with the Scottish parliament buying out an airport, and making the link that the whole master plan with Infratill, carried out over many years was to force a local council, TDC to do the same falls at the 1st hurdle.
30/05/2014 18:46:04

This Normal comment was left by Adrian [score: 0]:

What evidence is there that either company borrowed against the airports and spent the money elsewhere? Stagecoach is a big business with rail franchises, bus and coach operations around the world. Manston is a small operation by comparison. The history of the airport as a civil aviation enterprise is one of failure. Contrary popular belief low cost airlines, cargo operations and 'legacy airlines' didn't see it as a viable option. Thanet is well within the passenger catchment area of LGW and LHR not to mention Stansted and Southend. 85% of LHR cargo arrives and departs in the hold of passenger aircraft. It isn't viable for Manston to take the remaining 15% for freight companies, airlines and supporting infrastructure are more cost effective working at a hub. Duplicating operations at MSE makes no sense to them. Gloag seems to have spotted an opportunity to make money by buying 600 or so acres at a relatively knock down price and can afford to wait until the conditions are right to change use. Politicians go through the motions for election purposes but I suspect they know full well that Manston is not a viable airport. TDC and MPs ought to be exploring future use for the land for the benefit of the local economy rather than clinging to pie in the sky (forgive the pun) ideas about the glamour of the jet age. Finally, here's a thought: If the site was not an airport, and someone came along with an idea to build one there, would anyone think it a good idea?
03/06/2014 21:42:07

This Normal comment was left by Matt B [score: 0]:

In terms of evidence if the many news reports saying so are not enough then I guess you could check out their accounts which I understand (from said news reports) are quite something.

The viability of Manston was never in passengers but in freight, training and aircraft recycling as it was uniquely placed to handle these things. Manston is/was the only airport in the UK licensed to dismantle aircraft, for example and Kent Chamber of Commerce estimate that it could clear a million pounds a year in profits doing so.
04/06/2014 09:34:41

This Normal comment was left by Brogan Hutchings [score: 0]:

I'm with Mrs TP on this one. The more I learn the more I wonder how they get away with it.
04/06/2014 09:58:10

This Normal comment was left by Tango and Cash. [score: 0]:

I have no doubt that these companies have had business dealings, as their accounts will no doubt show, and as such as they have a previous business relationship, are likely to do so again. Companies, the same as people, tend to do business with people they know, there's nothing unusual with that surely?

But i think it's maybe a little thin to then extrapolate a vast conspiratorial narrative, based on nothing more than these companies and people have dealt with each other in the past.

If Manston is so potentially profitable, I am left wondering how so many professional airport operators have failed to make it so over such a long period of time, The list is long, and sad. I would really like to see Manston continue as an airport, but sadly it simply doesn't stack up financially,.

Large scale aircraft recycling? For that to happen, Manston wouldn't even necessarily need to be an operating airport. But leaving that aside for a moment, can you image the the volume of protest from all the usual quarters about breaking up aircraft at Manston? There would be tales of horrific potential pollution, the people of Thanet being poisoned by a contaminated aquifer, noise, airbourne pollutants, the list of protesters would be unending.

Recycling might well be a viable business option, but that would certainly not support the rest of the airport. But as so often in Thanet, few, if any companies would go through the hassle of dealing with those that seek to prevent progress. They are more likely to locate in places where they would be welcome, not resisted.
04/06/2014 18:29:08

This Normal comment was left by Mike Harrison [score: 0]:

Debt cannot accrue to land unless there is a charge on it, it will accrue to the company. IF TDC cpo the airport they will be buying the land and NOT the company.
Bang goes another Thanet conspiracy theory.
05/06/2014 14:29:09

This Normal comment was left by Richard [score: 0]:

In spite of you ruling a comment above as off topic Matt the fact remains now that next week Cllr Iris Johnson is scheduled to seek legal advice concerning TDC introducing a policy for compliance with Statutory Reporting Duties of Law which extend to specified knowledge defined by Terrorism Law.

If (And I won't hold my breath waiting) TDC introduce such a policy the question arises how much review of all related past TDC process will be necessary. Clearly that would be planning and grant aid and housing benefits and Standards admin. I note the confidence with which you pre-dismissed this having any Manston implications.
06/09/2014 12:38:45

This Off Topic Hidden comment was left by TROLL [score: -3]:

15/04/2016 02:35:55

This Off Topic Hidden comment was left by Naughty User [score: -3]:

03/06/2016 22:50:44
 


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