Ernst & Young has been appointed by the UK High Court as administrator to London’s Battersea Power Station. It is reported that the site will be formally put up for sale in the first quarter of this year.
The application for the appointment of an administrator was brought by NAMA and Lloyds Bank, reported to be owed approximately €380 million by Battersea Power Station Vehicle Ltd. Another creditor, Oriental Property Ltd, supported the application.
Real Estate Opportunities, the Irish company controlled by developers John Ronan and Richard Barrett, through Treasury Holdings, is the majority shareholder (54%) in the Battersea Power Station company. The minority stake is held by REO creditors who swapped their debt for equity in the company.
REO acquired the site in 2006 from Parkview Developments for approximately €600 million with finance from Bank of Ireland, HBOS and Hong Kong company, Oriental Property Ltd. In 2010 REO secured planning permission for a €6.4 billion redevelopment of the site into residential properties, offices and retail units. As part of a restructuring, it later transferred the site to a special purpose vehicle company.
Prior to the appointment of the administrator, NAMA and Lloyds rejected an offer by Malaysian investment company SP Setia to buy out the power station’s secured debt at a 15% discount (£262 million). More recently, the owner of Chelsea Football Club, Roman Abramovich, is reported to have expressed interest in acquiring part of the site as a new base for the premiership club. Reports suggest that the site could sell for up to €600 million.