Stoy Hayward’s work valuing Northern Rock is facing a New Year roadblock
after shareholders secured a court date for a legal battle, hoping to redraw the
terms of the engagement.
Roger Lawson of the UK
Shareholders Association said: ‘[The shareholders] go to court on 12
January. We will be contesting the legality of the government’s approach to the
compensation scheme order, which we believe are not compatible with humans
BDO valuation partner Andrew Caldwell must submit a price for Northern Rock
which strips out the government’s £25bn bailout package. The terms also require
the bank to be treated as a business in administration, and not as a going
This caused anger among shareholders, leading to the court action, but BDO’s
efforts to attach a price to the remains of Northern Rock may be dealt a serious
blow if they have to start again under new terms.
Caldwell is yet to inform shareholders about how he intends to proceed,
‘I don’t know what he’s going to say in his terms of reference. It’s going to
be very hard to come up with a value under the current framework for the
Lawson predicted there would be more legal battles next year, because neither
side was likely to back down, adding to the hefty court bills.
‘Whoever wins the judicial review, there will be appeals and the government
will be running up more bills at the taxpayers’ expense. The legal costs of this
case are absolutely astronomical.’
BDO has been paid a flat fee of £4.5m to conduct the valuation, but the
Treasury has said that there will be more funds available to fight any legal
cases brought in response to the result.
A BDO spokeswoman would only say that it was impossible to determine the
timescale for the valuation.
Steve Absolom and Will Wright from KPMG Restructuring have been appointed joint administrators to City Motor Holdings and associated companies
Partners from Johnston Carmichael have been appointed as joint administrators to Axon Well Interventions Products UK
Begbies Traynor have been appointed administrators of William Anelay Ltd, York, one of Britain’s longest-established construction and heritage restoration companies
Smith & Williamson has been appointed administrators of charity 4Children