Mountgrange change their name to Clearbell as administrator continues to chase them for millions of pounds.
Four and a half years after Mountgrange went under losing £60 million of Bank of Scotland’s money, the fight continues to try and recover millions of pounds from Mountgrange.
As you will already know, Craighouse was bought from Napier by Mountgrange and both are part of the Craighouse Partnership.
Mountgrange went into administration in 2009, leaving their notorious development, Caltongate (for which they had received planning permission which included the demolition of historic buildings in or around the old town) as an undeveloped hole in the ground.
In 2007, the two founding partners, Martin Myers and Manish Chande, took £9million and £3.8million respectively from Mountgrange Capital in dividends (this was in addition to their large salaries). This, in itself, was not unlawful.
However, in the last months of Mountgrange Capital PLC, there were some unusual transactions for a failing company.
One was director Manish Chande taking out another dividend of £1.5million in its struggling last months.
The other was £2.3million taken out of the company in the form of an interest-free loan.
This loan went, via an intermediary company (Mountgrange UK Ltd), to Mountgrange Investment Management LLP – the new fund management partnership which manages the offshore fund that owns Craighouse.
What happened to all the money?
The administrator, Deloitte, has been trying to recover some of the millions for the bank, employees, tax collectors and suppliers. To manage the sheer number of companies involved, they split Mountgrange into 4 groups:
- Mountgrange Capital PLC, the main company, the administrators have finished winding up. Of the £70m loaned to this company, only £10m was recovered. It doesn’t look like they attempted to get back any of the dividends taken out of the company in its final struggling months.
- Mountgrange Limited has some complex investments. This will be left running for possibly many years to come.
- Mountgrange Land Limited was Martin Myers’ main company and owned roughly half of Mountgrange Capital PLC. It also owned his racing stables. The administrator is still chasing Martin Myers personally for millions of pounds of personal loans and agreements, even after all this time. Recent news reports suggest that Martin Myers is now retiring and will not be so involved with the running of the remaining Mountgrange companies.
- Mountgrange UK Limited is the strangest of all. Mountgrange UK Ltd is the intermediary company used to set up the fund that owns Craighouse (Mountgrange Real Estate Property Fund – MoreOf) and its management partnership (Mountgrange Investment Management LLP). It was not put into administration at all, despite being one of the companies that shared the £70m loan guarantee. It was also in receipt of the £2.3m loan, used to fund the salaries of the people managing the Craighouse investment. The administrator, Deloitte, has clearly tried to get the £2.3m loan back from the investment management partnership. The accounts for Mountgrange UK Ltd state: “At the present time the administrators have not called in the loan although they have recently asked the company to seek to agree with the LLP … a formal repayment plan in respect of the capital contribution”.
Mountgrange Getting Rid of their Name and changing to “Clearbell” as Partner is chased for Millions
Mountgrange is headed up by two men: Martin Myers and Manish Chande.
With administrators still chasing him for millions of pounds, Martin Myers has recently announced his retirement. The other former director, Manish Chand, and the partners in the later fund management company are now forming a new fund management company, called Clearbell. One of the Mountgrange companies, Mountgrange Investment Management Ltd – the company that manages the Craighouse fund – has been re-named Clearbell Fund Management Ltd.
Manish Chande and others are presently raising money for Clearbell. Are the new investors aware of the connection between Clearbell and Mountgrange and the attempts of the administrators to recover the millions of pounds lost?
It isn’t clear what will happen to the rest of Mountgrange and MoREOF once the new fund is formed. Will they continue as normal, or be wound down? Will they finally have to pay back the £60 million debts that Mountgrange Capital PLC owed to the bank, the £2.3million loaned to it, or nothing at all? We don’t yet know, but we would like to find out.
Manish Chande was reportedly up in Scotland meeting senior politicians including key Councillors in recent weeks. We have already written on the issue of lobbying and access and how it is against the Code of Conduct for such people to gain greater access to MSPs and other politicians than ordinary people. If these meetings are not transparent, how can it be ensured that equal access is given, or that senior politicians also hear those communities opposing Mountgrange or Manish Chande’s schemes?
We are enquiring as to what other senior politicians Chande has been having meetings with. We will be asking our local Councillors whether or not Manish Chande paid them a visit.
In addition to Craighouse, Mountgrange is targeting more properties in Edinburgh and Glasgow. You may read more about their history with other sensitive projects here.
If you want to see Mountgrange’s other recent conservation efforts take a look at this picture of what they are doing to Category-B listed historic building the Odeon cinema in Glasgow. The protected building has now been completely demolished apart from one facade – that will be dwarfed by a ten storey concrete and glass office block built out the back of it.
Craighouse and Finance
Craighouse is a seriously protected site covered in numerous protections that protect other sensitive Edinburgh sites. The Craighouse Partnership have consistently failed to release serious and comprehensive financial information required to justify any newbuild on the Craighouse site, let alone the very excessive amount of newbuild they are seeking – on 8 development sites all over the Craighouse site.
With Mountgrange, Sundial, Napier, Oberlanders and Invicta all looking to make large profits – ask yourself how it can be possible for proposals that seek to deliver such profits to so many players can be “at a minimum” in terms of enabling development.
Many Questions Remain
Do Mountgrange have any intention of actually developing Craighouse?
Will the new company, Clearbell, take over the Craighouse development: what are the implications of this?
Can any of the companies associated with Craighouse be chased for the 10s of millions of pounds that are owed by these companies?
Why might Manish Chande be meeting senior politicians at this time?
Why is one of the main partners retiring when he is being chased for millions of pounds?
Why is Mountgrange now seeking to change their name?
Why are there no meeting notes for Mountgrange with the Council and Historic Scotland – when they exist for the other bidders?
Are Clearbell’s investors aware of the connection between Clearbell and Mountgrange and the administrator’s attempts to recover the millions of pounds lost?
What did happen to the Mountgrange millions?