Challenge Business goes into administration

by IBI Magazine/Michael Verdon/S-W on 11 Oct 2006 The Challenge Business International Limited, a company established by Sir Chay Blyth to organise the Global Challenge round-the-world yacht race, has gone into administration. According to a company statement on its website, Nigel Morrison and Richard Hawes, partners in Grant Thornton UK LLP, have been appointed joint Administrators.

The Daily Telegraph today reported that;

'Latest accounts filed at Companies House show that the Challenge Business International made a £620,663 loss inthe year ending December 2004. The accounts also reveal that Sir Chay had an £81,000 unsecured and interest free loan from Challenge Business International - in contravention of teh Companies Act'.

The first Global Challenge race, The British Steel Challenge, took place in 1992 to 1993 and the race was run four times. The company has also managed or participated in the Round Britain and Ireland Challenge, Transat Challenge, and Rolex Fastnet Race.

But the company's turnover fluctuated seasonally and year-on-year, according to the statement. Sales were also impacted by whether a major racing event fell within the financial year.

'The business model for the company required that the Global Challenge series attracted heavyweight title holder sponsorship, which proved impossible for the last race in 2004-5,' said Nigel Morrison in the statement. 'The company has worked hard to find a sponsor for the next race in 2008-9, but with no success it was forced to announce the postponement of the next Global Challenge race. Cashflow became difficult to manage as the Company entered into the autumn with very few events scheduled until next spring.'

Morrison said he will 'establish whether there is a possibility for a going concern sale of the business or whether it will be necessary to realise the assets of the company separately.'

Challenge's assets comprise largely of the 18 bespoke yachts used in the Challenge series of events and include Aviva, the yacht that was recently sailed by Dee Caffari in her successful campaign to become the first woman to sail non-stop the wrong way around the World.

Currently the Company owns five 67ft yachts and thirteen 72ft yachts, all of which have featured in the Challenge Series.