Silverjet's boss fails to escape bankruptcy

Former chief of two failed airlines cannot convince administrator to accept offer for creditors
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The Independent Online

Peter Owen, former chairman of failed airline Silverjet and one-time chief executive of collapsed airline XL Leisure, has had his attempts to escape bankruptcy quashed by Silverjet's administrators.

Mr Owen, who was declared a bankrupt at Kingston-upon-Thames Court in May, is believed to have offered Silverjet creditors a small percentage of the £240,000 he owes the company after settling with the other creditors.

But it is thought that the administrator, the insolvency group Begbies Traynor, has rebuffed the offer.

This means that Mr Owen, who owns a £1m house and three cars including a BMW X5, is unable to extricate himself from bankruptcy at present. A City source said: "Owen has offered a sum of money to Silverjet that is frankly derisory. If he can settle with other creditors then he should do the decent thing and settle the £240,000 he owes Silverjet too."

When the airline was created, Mr Owen bought shares and was allowed to owe the company cash. When the firm got into difficulties, he was asked to pay for these shares, but he did not and was declared bankrupt. It is believed that Mr Owen will continue his efforts to annul his bankruptcy in court later this month.

Mr Owen declined to comment.

His attempts to get himself out of bankruptcy come four months after the collapse of XL Leisure. At the time, amid accusations that he got off lightly compared to disgruntled holidaymakers, Mr Owen said: "I don't understand why I am better off than they are. I don't think you can be blaming any individuals."

Mr Owen was further criticised by Phil Wyatt, the founder of XL Leisure, in December. "If I've made mistakes, it's that I should never have got someone else in to run a business I was a majority shareholder in," Mr Wyatt said. "I should have encouraged Peter Owen to step down from Silverjet, as no one can be 100 per cent focused on one job while having two roles."

Silverjet fell in May, weeks after it announced it had secured a loan of up to $100m from Viceroy Holdings, a Middle-East investment firm. The first instalment of $5m failed to arrive and days later Silverjet was force to ground its jets, leaving its customers stranded. A Serious Fraud Office investigation into the collapse was later abandoned.

The Luton-based carrier offered business-class flights to New York and Dubai for about one-third of the price of a BA ticket, and was thought to be losing more than £1m a month.

Meanwhile, the extent to which the Civil Aviation Authority is owed cash by XL Leisure remains uncertain. A report by its administrator, Zolfo Cooper, suggested the CAA could stand to lose as much as £40m, although the final figure is expected to be far lower.