A History
of Manston Airport from July 2005 to 2015
2005
Mr. Tony
Freudmann had overseen Manston’s transfer from an RAF base to a commercial
operation. He was Senior Vice President of Wiggins Group between 1994 and 2005.
He was ‘let go’ by Wiggins in February 2005. He is now the spokesman for the
RiverOak consortium*1
*1 “KCC-Position-Statement-on-Manston-Airport”
2006
The airport
was sold to Infratil for a sum reputed to be around £17M and separately Kent
International Business Park (70 acres hived off to raise £4M for investing in
further airports) was sold to Kent County Council (KCC) for £5.35M *1. During
Wiggin’s tenure the area of Manston reduced from 1100 acres to 720 acres.
Anthony
Freudmann (who resigned from Wiggins/Planestation in Feb 2005) approaches KCC with
a view to building a Manston to Virginia US holiday route using his “experience”.
His initial report costing £50K was followed by further invoices totaling £176K
then in early 2007 KCC invested a further £289K in the venture. There were no
ticket sales and the project was abandoned by KCC
2007-2009
Infratil
invests heavily in Manston
“Infratil
Limited is a successful company listed on the New Zealand stock exchange with
the primary purpose of investing in electricity distribution, public transport
and ports. The company was established in 1994 with NZ$50m of capital. At the
time it acquired Manston and Prestwick airports it controlled assets worldwide
in excess of NZ$ 4.4 billion. Following Wiggins’ demise, Infratil Limited
bought Manston Airport from the Administrator for £17 million in August 2005.
In addition
to Manston, Infratil also owned Prestwick, Flughafen Lubeck, Wellington and
Auckland Airports. Its master plan for Manston (published in November 2009)
envisaged building a new passenger terminal to accommodate up to 3 million passengers
per annum. It also envisaged building a parallel taxi way to the runway and an
increase in the freight and passenger aprons. At the time of publishing its
plan the airport was handling 32,000 tonnes of freight per annum. The master
plan envisaged freight growth of between 4% and 6% per annum to equate to
approximately 167,000 tonnes of freight per annum by 2018. It also planned on
developing corporate jet facilities with an executive terminal.” *1
In 2009 the
airport was handling fewer than 50,000 passengers per annum, the airport
employed approximately 100 people, some full time and some part time and cargo
was just 30038 tonnes.
2010 -2011
Infratil
approached Thanet District Council (TDC) with a view to altering the current
flying agreement (S106) to allow cargo flights between 11pm and 7am. At the
time of requesting this approximately 50% of cargo flights (20% overall) were arriving during
the night anyway. A series of reports were commissioned to support this request.
2010-10-BAP-report-Night-Noise-Assessment
2011-08-Economic-IMPACT-of-Night-Flying-Policy-York-Aviation
2011-10-BAP-Noise
TDC’s response
was to debate the request in chambers and then to ask MORI to run a poll in
Ramsgate to determine the response from the electorate. This Poll was
overwhelmingly against Infratil’s request. TDC then told them NO. In response Infratil put the airport
up for sale with Price Waterhouse Cooper. It was to remain unsold for nearly two years.
Anthony
Freudmann 2006-2011
On leaving
Planestation, Anthony Freudmann became involved in the travel industry. His
parents had established a travel business in the 1960's and his brother,
Steven, took the helm of the family firm, Majestic Travel and rose to the top
of the industry. He was a director of ABTA for 18 years and it’s President during
1997-2000. The complexities of Anthony Freudmann’s relatively brief involvement
in the travel industry precludes a detailed analysis. There were a number of
acquisitions. Some of these acquisitions would seem to have been direct whilst
others were made through Alpha Consolidations Ltd and Alpha Prospects PLC,
companies founded with his brother Steven.
Anthony's
travel companies included Carefree Travel acquired on 22/3/07, Radiant Travel
22/3/07 Travel Club of Upminster, (founded in 1936), Upminster Travel, Austria
Travel all acquired on the 19/1/09. Majestic Travel, the old family firm was
purchased from his brother Steven on 6/2/09. Seligo Holidays 23/2/2009 A useful
summary from Travel Trade Gazette of the state of play on 19th March 2009 goes
some way to unravel the complexities. “Steven Freudmann is a director of Alpha Prospects,
a plc listed on the Junior Plus stock market and set up in 2008 to invest in
travel companies. His brother Tony Freudmann was a director of Unpackaged
Holidays Ltd of which Seligo was a trading name. Tony Freudmann is also a
director of The Travel Club, the company which bought the assets of Unpackaged Holidays.
Tony Freudmann is also a director of Unpackaged’s parent company, UHN Ltd, of
which Alpha Prospects has an option to acquire. Tony Freudmann is also a
director of Seligo Holidays Ltd, which was set up in February and could now
become the trade arm of The Travel Club. Alpha Prospects also has an option to
acquire Alpha Consolidations Ltd, which owns The Travel Club Ltd.”
It was not
very long before all of these companies, with the exception of Anthony and
Steven's Alpha Prospects, bit the dust. Steven resigned his Directorship of ABTA
after calls to do so from creditors of Seligo / Unpackaged and at a time when
he was due to face questions from the board regarding the collapse of and
involvement in, the Unpackaged Group run by Tony and Alpha Prospects.
2011-2013
During this
time when Manston was being touted for sale by PWC attention was also focused on
Lahr in the German Black Forest by Tony where Messrs. Joshi and Soards were being
fronted by Anthony Freudmann in the acquisition of that airport using a company
called INTEGERAL LIMITED (06602485) which was ordered to be wound up on the
28/2/2013.
“In June
2012 Anthony Freudmann returned to Lahr. Equipped with a business plan that
might sound very familiar. The focus would be on freight, aircraft stripdown and
recycling, a new West African Airway would establish a base, there would be
aviation related industry and parking and leasing of aircraft.
In fact,
nothing happened. In October 2012 an
article in Stadtanzieger commented on the workers at the airport not having
been paid but stated that the Mayor had been reassured by Mr. Freudmann that
the payments had been initiated. Two weeks later on the 14th November when the
wages were still not paid, the same paper quoted Mr. Freudmann as saying that
he had no comment to make as it was a “private matter”.
By January
30th 2013 there was considerable speculation as to what was going on and the
local press stated that the editorial team had not seen Anthony Freudmann at
Lahr since the 5th October 2012. However the 30th January 2013 was a
significant day for Integeral Investments for reasons other than the
speculation at Lahr, for they were in the High Court in London for the final
hearing of a contested winding up petition and a counter application for the
company to be placed into administration. Whilst Mr. Freudmann was representing
Integeral on the ground at Lahr, a winding up petition in respect of the
company had been presented to the High Court on the 25th July 2012.
However,
what is perhaps more striking is that the court heard evidence to the effect
that in fact, Integeral was insolvent “from (at least) late 2011". The
significance of this of course is that it would seem that Integeral was
insolvent before they even got involved in the Black Forest Airport. Now of
course it could be that Anthony Freudmann was completely oblivious to this
state of affairs in which case one would have to question the absence of his
making his own enquiries as to the status of the company he was representing. The
judgement does however have a mention in passing in that is with regard to this
project that Integeral owed a Mr. Douglas John Maggs the sum of £460,000, thus
revealing Maggs (through a company) as an investor in the Lahr project. DJM lived at 11 Grosvenor Hill, London W1K
3QA, an address that becomes important later in 2013.
Back to Manston
A number of
previously unpublicised facts emerged from the evidence presented to the Select
Committee, ‘Small Airports’ inquiry, among which, was that it was Anthony
Freudmann that introduced Anne Gloag to Prestwick and Manston Airports as
potential business ventures. Both airports being owned at that time by New
Zealand company Infratil. Anne Gloag’s company purchased the latter only, with
an announcement to that effect being made on the 29th November 2013.
We now know
that just two months after the deal that he brokered goes through, Mr.
Freudmann decided that he wished to purchase the airport himself. This first
came to light in an interview Anne Gloag gave to the Kent Messenger on the 8th
August 2014. In relation to a question
asked about enquiries being made as to the potential of house building on a
part of the airport lands known locally as the Northern Grass, she had this to
say. "This representation was initiated, promoted and paid for by Tony
Freudmann and Annax Aviation who had indicated they wanted to purchase the
airport at that time and were keen for consideration to be given to alternative
uses for the Northern Grass to be included in the Local Development Plan. The
representation was not made by us. We did attend one meeting with the council,
Mr. Freudmann and his planning advisor, when we were made aware it was
happening, as we had concerns and felt, as the landowner, we should be
represented"
Check the address where Annax was registered.
Anthony had
approached a businessman with a view to buying Manston for £8M with £2M of
working capital. Annax Aviation Ltd (08576648), now dissolved, was incorporated on 20 Jun 2013 and
Freudmann had been in the process of approaching Thanet Planning department
with a proposal to build 1000 houses on the Northern grass. When that collapsed
through failure to acquire the funding, Freudmann approached Ann Gloag. Her
evidence to the select committee on airports said:
“This
submission is provided on behalf of Manston Skyport Limited, following a
written invitation from Mr. Nick Beech on November 6th 2014 to submit written
evidence to assist the Select Committee in its review of the viability of
regional airports in the UK.”
“The
opportunity to acquire Manston Airport was introduced to us by a consortium
including a former executive of the airport prior to its insolvency in 2005 (Anthony Freudmann, Douglas Maggs et al).
At that time it was part of a larger transaction involving Prestwick Airport,
in Scotland.”
“The sale
consisted of two businesses, Infratil Kent Airport ltd and Infratil Kent
facilities Ltd (being the operating company and the property owning company
which made up the airport business).”
In fact by
November 2013 Ann Gloag had purchased the airport and debts and then set out to
see if it could be viable
2014-2015
In Gloag’s
words to the select committee:
“Two key
executives were brought in to the business to conduct a thorough review of the
business and to report to shareholders on options for the future. One of these
executives was a highly regarded Chartered Accountant who had worked on
numerous turnaround strategies on behalf of funders and investors; the other
was an industry professional with extensive aviation experience, and who
crucially had led a team that had successfully turned around a UK Regional
Airport.
The remit
given to the turnaround team was to put in place strong cash management
procedures as this had been a key concern of our advisors during the due
diligence period; and secondly to consider how income generation at the airport
could be enhanced.
At the time
of purchase, a number of possible upsides had been identified. The key three
ones were:
3.2.1. That the Davies Commission would
support making best use of existing runway capacity and not support a further
runway in the SE.
3.2.2. The British Airways cargo operations at
Stansted could be migrated to Manston.
3.2.3. That Ryanair would set up a major new
base at Manston.
Whilst all
of these options had been considered and assessed, by Christmas 2013 it became
clear that Ryanair, after two profits warnings was undertaking a major
strategic review and announced it was moving from a policy of remote airports
to more central ones. The Davies commission had published its options
assessment, which did not favour Manston, but further capacity at either
Heathrow or Gatwick (or, at that stage, possibly the Thames Estuary). In
addition, shortly thereafter, British Airways announced they were terminating
their cargo operations at Stansted- and not migrating them elsewhere.
At the same
time it became clear that the airport’s finances were in a worse state than had
been understood during purchase negotiations, with losses significantly higher
than expected including a large number of outstanding commitments that had been
omitted from the sale information. For example, a radar, which had been
installed some years ago, had outstanding payments due within a year of
purchase of around £420,000.
In
addition, during the review of the business, the consortium (Freudmann, Maggs et al) who had
originally introduced the opportunity to Manston Skyport continued to negotiate
with the new owners to purchase the airport. However despite many deadlines
coming and going, this consortium consistently failed to demonstrate proof of
funds and failed to complete on any of the dates they had promised. (Where have we heard that before?)
The
business review concluded that losses would continue into the future and that
cash of over £10m would be required to maintain airport operations over the
following three years. Even if all of the possible changes were delivered and
if no existing business departed, resulting cash requirements over the
three-year period would be over £7m. Critically,
at the end of the three-year horizon, there was no prospect of the business
becoming profitable. The Directors of Manston Skyport very carefully
considered the situation. They were not in a position to continue to fund the
business’ losses indefinitely and with no credible buyer available, they
resolved to inform the Directors of the airport that, as shareholders, they
could not continue to fund the business, in the absence of a realistic
expectation of future returns.
Around 25
staff had chosen voluntary redundancy prior to the date of closure and a
further 15 were retained to support the closure activities. Around 100 staff
were made redundant on the date of closure, 15 May 2014.”
After it
became clear the Anne Gloag had taken the decision to close the airport and it
would seem that Tony Freudmann then went in search of financial backers to
purchase the airport.
A
businessman, resident in the Columbian city of Bogota, expressed an interest in
investing in the airport to Sir Roger Gale who immediately referred him to Tony
Freudmann. Doubts grow as to whether the ING bearer bonds that he presented as
evidence of capital were in fact genuine.
RiverOak
Investment Corps of Connecticut are then named as the new investors. It was
said that Tony was at a conference in Canary Wharf where he met the MD Steve
DeNardo and the rest as we know is history.
RiverOak
“Following the failure of negotiations between Anne Gloag
and RiverOak the suggestion was made that the Airport should be made the
subject of a Compulsory Purchase Order and whilst it is not entirely clear from
whom this idea emanated, it was taken up with gusto by the Member of Parliament
for North Thanet with the orchestrated backing of the various groups wishing to
see Manston returned to its former usage. That the use of such a draconian
measure to deprive one set of people of their land in favour of another group,
one might suppose would sit quite uncomfortably with a Conservative politician.
Apparently not, as despite the bullish approach of the US Company, with their
schoolboy gibes of “my lawyers better than your lawyer” he has not only
continued his support for a Compulsory Purchase Order, he has accused Anne
Gloag (under the protection of Parliamentary Privilege) of being a liar. What
is surprising is that when it became apparent that, in whatever capacity, the
two former directors of Integeral were involved with Riveroak, that anyone
seriously considered that Thanet District Council would even entertain further
dealings with the company. Given the
Council’s troubles in the past with outside companies it might be hoped, that
they would have by now developed an ultra-cautious approach to such
dealings. In any event, despite various
extensions TDC determined that RiverOak had not met its criteria. That should perhaps have been the end of the
story.
However Sir Roger has continued in his quest to have the airport lands
delivered to the US Corporation and has raised questions as to whether the
purchase of 80% of the controlling company by the developers of Wynyard and
Discovery Parks was indeed a ‘real’ sale back in September. Supporters of the
airport have become obsessed with the ‘real’ ownership of the land and spent
hours trying to prove that in fact, Anne Gloag was the ‘real’ owner. Sir Roger
even managed to divert the Transport Select Committee from its brief of looking
at the role of smaller airports into an inquisition into who owns land.
When RiverOak made Anthony Freudmann a Partner and Managing Director of
RiverOak, it was clear that he was to represent their’ hands on experience of
aviation and airports’. Given what might be considered by some, a less than
impressive track record in keeping companies afloat and given that none has
seemingly thrived under his management, why would anyone think that he was the
right man for the job of getting Manston flying again. The suspicion must
remain that Douglas Maggs has involvement with the Manston project Has he and
Messrs. Soards and Joshi be hiding in the wings? Some, including the writer
believed so and to get an answer one way or the other, wrote to Mr. DeNardo
asking this question on the 12th December 2014 but still await a reply. The same question was put to Sir Roger Gale
by e-mail on 3rd February 2015, he was good enough to respond very quickly but
did not answer the two questions posed, i.e. why he had such confidence that
Anthony Freudmann was the right man to turn the airport around and as to
whether Joshi, Soards or Maggs had any involvement in any capacity in Riveroak’s’
Manston ‘venture’. In a second e-mail
the writer elaborated on Tony Freudmann’s career and gave further information
regarding the ‘Lahr’ project, again, asking the question as to whether the
three men were involved. The reply, suggested that the information (all
garnered from the public domain) might be libelous to Tony Freudmann. Again the
question remained unanswered. This might suggest that not only are these three
men involved but that Sir Roger Gale is fully aware of their involvement.
It would have course been very easy for Sir Roger to simply state “to
the best of my knowledge and belief none of the named parties are involved in
any capacity in the RiverOak Manston project” that he did not, might perhaps
suggest that they are and that he was unwilling to confirm this fact.
Confirmation of Mr. Maggs involvement has been provided in the form of
correspondence submitted into the evidence of the Select Committee on 23rd
February 2015.”
“Re: Letter dated 2lst November 2014. On a more
general note you (Roger Gale) continue to champion the cause of Riveroak who we
have tried to contact and who seem reluctant to talk to us (Mssrs Cartner &
Musgrave). We have recently been approached, via a third party, by Mr. Maggs,
who claims to be working with them (Riveroak) and who asked for our contact
details, which we gave. He has an interesting history (he was made bankrupt in
2016) of failed property ventures and controversial housing scheme proposals
attached to his name and we weren’t aware until recently of his involvement.”
“This correspondence dated 25th November 2014 was submitted
in rebuttal of Sir Roger Gale’s evidence to the committee that Messrs Musgrave
and Cartner had not responded to his enquiries in respect of the ownership of
the Manston site. This letter suggests that Mr. Maggs represented himself as
“working with RiverOak”
Local reporter Tom Barnes approached DeNardo in respect of Maggs
involvement and he (unlike me) was given the courtesy of a response. The response however raises more questions
than it answers. “RiverOak has never worked with, employed or indeed had any
formal involvement with Douglas Maggs. Mr. Maggs at one time offered to
approach a Discovery Park investor to see if a meeting between RiverOak and the
owners of Discovery Park could be arranged. It went no further than that”
Douglas Maggs according to Company Check has been the former director of
37 Companies. As alluded to in the correspondence cited, he is a property
investor with a certain reputation. According to Company Check, in addition to
his previous Directorships, he currently holds 28 Directorships, these
companies having an asset value of £69 million. Under another registration
number he is the director of Rosslyn Film Partnerships, with assets of just
under £8 million. In addition he is reputed to have considerable offshore
interests.
So this very busy multi-millionaire just strolled along to RiverOak, a
company he has no connection with and offered to pay a visit to another
company, where he was not known, just to do RiverOak a favour. Such altruism
may damage his reputation. RiverOak and indeed Sir Roger Gale have consistently
relied on what they perceive to be the gullibility of local people and the
unwillingness of the press to look closely at who these people really are. It
is perhaps notable that the ‘denial’ of Maggs involvement does not preclude him
being a ‘potential investor’.
What perhaps is remarkable is that the situation ever got to the stage
whereby anyone would seriously entertain doing business with RiverOak. The
involvement of Anthony Freudmann with a string of business failures, including
of the course at the very same airport, should have been sufficient to raise
the alarm. One might have hoped that the sniff of the rest of the Integeral
team’s involvement would have been sufficient for the drawbridge to be hoisted
up back in May 2014. Even when it was revealed that RiverOak had chosen to
incorporate a new company in Delaware to be the indemnity vehicle, the process
continued. (Delaware, whilst hosting legitimate businesses, is also the
favoured state of ‘less legitimate entities’ who appreciate the anonymity given
to investors)
It would seem likely that the momentum for this folly has come from a
very intelligent orchestration of the supporters groups, perhaps manipulation
would be a more suitable term, in a process given an air of respectability and
credibility, by the vehement endorsement of Sir Roger Gale. Like the people of
Lahr, Thanet residents are also being kept in the dark as to the true cost of
this fated enterprise, although it has been remarked by one councillor that the
officers of the council have spent almost all of their time on this project, no
‘formal’ record has been kept according to Freedom of Information
requests.
Many questions remain unanswered although of course we could all
speculate. Why is RiverOak, a real estate investment company, so keen to obtain
an airport that has never been commercially successful? Do they think that Anthony Freudmann’s
revived Wiggins / Planestation and Integeral business plan will succeed for
them, when it has failed for others or do they in fact have their eyes on the
future potential of 720 acres of land for other purposes, after all it was
their Tony who went to the trouble of obtaining the services of planning
professionals back in January 2014? Why in the summer did Anthony Freudmann
incorporate Aviation companies in Ireland?
I suspect that we may never get the whole story. Anyone who has had an
even cursory perusal of the law relating to Compulsory Purchase will be
confident that an opposed CPO would be bound to fail. Even if a new council
were comprised of sufficiently irrational beings as to ignore officer advice,
the CPO will not happen. Whilst I am keen that this matter is now disposed of
with all due expedition, it is my hope that whichever organisation is given the
task of reviewing TDC’s decision making process, that they spare a few minutes
to take a closer look at the persons and entities backed so keenly by Sir Roger
Gale and if appropriate, refer the whole sorry saga to any appropriate
authorities.” *2
*2
submitted to the NSIP DCO
In the end
the CPO failed due to Riveroak being unable to complete “Due Diligence”. In
other words they could not provide proof they had sufficient monies to
indemnify Thanet Council.
