Oyster Yachts has been bailed out of administration by gaming software entrepreneur Richard Hadida in a rescue which is hoped to save most of the company’s staff.
The Southampton-based builder of luxury sailing yachts ceased operations last month in a collapse caused by a combination of low margins and poor cost control, along with an insurance claim relating to the capsize of one its its vessels in 2015.
KPMG was brought in as administrator to try to find a buyer for the business and Mr Hadida has sailed to rescue in a move expected to see as many as possible of the company’s 420 staff based in Hampshire and Norfolk re-employed.
The failure of the business – which builds, services and charters vessels of up to 118ft in length – came despite it having its largest-ever order book, thought to be about £10m higher than the £70m reported for 2016.
Annual accounts for the parent business Oyster Marine Holdings show that the company had revenues of £42m in 2016, and made a pre-tax profit of £104,000.
The previous year’s figures show the business suffered a £5.2m hit from the sinking of the Polina Star III yacht, which dragged it to a £7.4m loss for the year, leaving the company’s finances foundering.
Mr Hadida’s involvement will allow Oyster to resume construction on vessels and wider operations which had been paused following the company’s failure, which resulted in all but a skeleton staff made redundant.
Mr Hadida, who made his fortune developing software group Evolution Gaming, said he “fell in love” with the yacht builder having sailed one its vessels but added that his investment in Oyster was “not merely a hobby”.
“I believe we must save great this British brand and nurture it for the long term, ” he said. “But it needs to be a sustainable business: hard, quick decisions need to be taken.”
The entrepreneur said although his previous business experience means he is “ill-equipped” for the yacht business, he can bring “commercial acumen and common sense” to the company.
This is likely to result in Oyster adopting modern construction techniques, such as modular construction, to reduce build times.
“The boatbuilding industry needs to evolve like every other industry,” Mr Hadida added.
Oyster is just one in a series of UK boatbuilders to have been swamped by poor financial performance in recent years.
Powerboat builder Fairline collapsed in 2015 and was bought out of administration in 2016, just as rival Princess Yachts announced plans to cut 350 of its 2,300 staff, though the number of job losses was eventually less than half this as the company enjoyed a stronger performance than expected. Sunseeker Yachts was bailed out after years of poor financial results in 2013 by Wanda Dalian. The Chinese investor spent £300m to get a 95pc stake in Sunseeker.
Mr Hadida refused to be drawn on the size of the investment he is making in the company beyond saying it is “many millions” and will see him use his own fortune to provide working capital. He will take on the role of interim chief executive until a permanent replacement is found and Oyster is now rebuilding its management team.
Kim Stubbs, who helped turn around fellow British yacht company Sunseeker, has also been brought in to navigate Oyster back to health.
Future plans for Oyster could include moving into the thriving market for smaller yachts, below its current smallest model, which measures 47ft in length.