Dundee flight school Tayside Aviation Limited has entered administration just 16 months after being bought by prominent entrepreneur Tony Banks.
Staff were informed of the news today, which has immediately resulted in 22 job losses.
Tayside Aviation, based at Dundee Airport, is widely recognised as Scotland’s premier flight school.
It provides courses from private pilot licences to full commercial airline licences. It has proudly delivered the RAF air cadet pilot scheme for over 30 years.
Tayside Aviation administration
Joint administrators Blair Nimmo and Geoff Jacobs said the business, which has operated in Dundee for 55 years, has “ongoing working capital requirements that are unable to be funded”.
This is despite the millionaire founder of Balhousie Care Group, Tony Banks, acquiring the business in December 2021.
The administrators said the cash generation for the business has been impacted by the number of pre-paid flying courses sold before his acquisition.
Mr Banks has since funded the business to the tune of £1.5 million in addition to the undisclosed purchase price.
A statement from the administrators said: “The company had a significant liability for pre-paid flying courses, the delivery of which adversely affected the company’s ability to generate income from new sales as manhours and air slots were being utilised to honour legacy prepaid courses.
“At the same time, further challenges arose through delays in onboarding senior personnel which adversely impacted business performance.
“Despite a significant investment from the shareholder of £1.5m in addition to the purchase price, these issues have led to ongoing working capital requirements that are unable to be funded.”
New buyer sought for Tayside Aviation
The administrators said Mr Banks had explored various funding and sale options.
But cash flow pressures intensified, leading to the administrators being appointed.
The business has now ceased to trade. A total of 22 of the Company’s 25 employees have been immediately made redundant.
Mr Jacobs said: “We will be taking all steps to rapidly assess whether there are any parties who would have an interest in the business and assets.
“We would advise those with an interest to make contact quickly.
“We appreciate that there will be many customers who are in receipt of pre-paid flying hours.
“We will collate details of these parties from company records and include them within the list of creditors, whom we shall contact in due course to advise of the claim process.”
Mr Nimmo added: “Clearly this is a disappointing outcome for everyone involved in this well-known and long-established business.”
Statement from Tony Banks and company directors
Mr Banks bought the business from the Watt family.
He sold a majority stake in Balhousie Care Group last year.
The directors and Mr Banks have released a statement about the decision to put Tayside Aviation into administration.
It said: “Our thoughts are with our dedicated team, as well as the students and RAF cadets profoundly affected by the closure.
“We are devastated that, after many months of tireless work, we have been unable to save this incredible business that has made Dundee an aviation hub for over 50 years.
“Our priority is to assist those members of staff who have been made redundant, providing them with the information and support they need to claim their statutory entitlements from the Redundancy Payments Office at this very difficult time.”
Tayside Aviation history
Tayside Aviation was established on February 28 1968 by pilot Lovat Fraser, who retired as managing director back in 2007.
A key moment for the firm was in 1978 when the flight school was awarded the first RAF Flying Scholarship contract.
In 1994, it became the sole UK contractor for the Flying Scholarship Scheme, training more than 500 cadets per year with the support of seven sub-contractors throughout the UK.
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