Written by: Keith Tully
Published: 21st September 2015
Formula 1 motor racing team Lotus has been given a week-long reprieve by the judge in an insolvency case which could yet see it enter administration within a matter of days.
The Oxfordshire-based company owes around £900,000 in unpaid taxes with HM Revenue & Customs (HMRC) keen to recover what amounts it can from the business.
Lotus’ lawyers argued in the case at the High Court in London that the issue of an immediate administration order would leave the company unable to trade and result in the loss of 400 jobs.
Mr Justice Birss, presiding in the case, said that he would give Lotus a chance to secure the “significant funding” that would be necessary to see the company satisfy its creditors and avoid administration.
However, he made clear that it would be the final time he would be willing to grant an adjournment in the case. His decision was made on Friday September 18, with the adjournment set to last for just seven days.
Reports have suggested that Lotus could soon be the subject of a takeover bid involving its former owners Renault.
“The parties have satisfied me that that there is genuinely a real prospect that the first stage of the deal that is being described will be signed in the next seven days, which will allow significant funding to go into the company,” the judge said.
HMRC’s lawyers in the case had argued that there should be no further delays and, with one adjournment having already been granted earlier this month, that a second was not appropriate.
From the perspective of HMRC, the issue has centred around unpaid income tax and National Insurance on the part of Lotus for June and July of this year, with other amounts soon to be owed by the company for August.
Lotus is hoping to see Renault firm up and proceed with its plan to acquire a majority share in its business in the coming days.
Renault’s plan is understood to be to acquire 65 per cent of Lotus with a view to making the switch from being an engine maker for other Formula 1 racing teams to becoming a constructor competing in the high-profile international championship.
14th July 2020
The UK economy grew by 1.8 per cent during May but that rate of expansion was considerably slower than most experts had been hoping for and expecting to see.Read More
8th July 2020
The number of emergency loans approved for small businesses across the UK has now topped one million, according to the government’s official figures.Read More