The administrators for the owners of the Prax Lindsey oil refinery have set out how they see the future panning out for the 87 forecourts owned by the beleaguered firm.
Teneo Financial Advisory was tasked by the High Court to manage the insolvency of parent company State Oil Limited (SOL). Prax’s retail division is known as Prax Limited and, despite being owned by SOL, constitutes a separate business that is not subject to insolvency proceedings.
But with the various firms operated by the group owing hundreds of millions of pounds to creditors, including £70m to HMRC and £10m to Shell, the administrators are looking into how funds can be released from viable elements of the business. The ‘retail division’ section of their 112-page report, published on Prax Petroleum’s Companies House listing this week, details how this may pan out.
The administrators say that the retail division “is considered to be a valuable asset of SOL” and is therefore a “key potential source of returning value for SOL’s creditors”.
Teneo says that after appointing two new independent directors the retail division has “achieved a period of stability” and is now “considering its options” with regard to how it can “effect its ultimate separation” from the main business.
This will likely involve the 87 UK forecourts owned by Prax Limited being sold off as a job lot rather than being moved on piecemeal. Forecourt Trader understands that several Top 50 Indie operators are bidding for the sites, which are mainly BP branded, with around 26 under the Total Energies banner, some Shell, and three Harvest Energy forecourts.
Less certain is the fate of the 125 dealer-owned UK forecourts. Despite being contracted to buy fuel from the Prax Lindsey Oil Refinery (PLOR), the administrators detail that these forecourts have “had to source fuel from external suppliers as the wholesale division has been unable to procure fuel from PLOR”.
In addition to Prax’s UK sites, the firm has 320 forecourts in Germany, Denmark, Switzerland and Austria, with 275 being operated by the company under the Oil! Brand and being up for sale, and the remaining being third-party owned.
