Closure of nursery saved 14 jobs

Ally McGilvray • Published 21 Apr 2010 16:11 0 Comments

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A DIRECTOR of one of the biggest children's play centres in the Borders has revealed it was forced to enter voluntary liquidation earlier this year to avoid going bust.

Jane Kemp, who ran the business with her husband Clive, this week broke her silence on the closure of Scotia Kids in Galashiels.

She blamed the credit crunch and warm weather for a drop in visitors to the indoor adventure playground at Netherdale industrial estate last year.

However, the nursery boss - who has since reopened the formerentre's nursery under the new name of Osito Nursery Limited - denied claims from a former director that it owes creditors £300,000.

In a statement to the Border Telegraph, Mrs Kemp - who revealed she and her husband were personally liable for most of the losses - said: "Scotia Kids does not owe any money to any local traders, contractors, suppliers or businesses.

"After seeking advice from an insolvency company, we have gone into voluntary liquidation before debts are accumulated and we have been very conscious of other businesses and made sure that they do not suffer.

"Believing that we could go bust in the next year or the year after, if the recession continued, we felt that we had no option but to do this and gave notice to terminate the lease in February."

The director explained that her and her husband, who started the business in April 2005, had incurred losses of around £200,000. However, despite finding a potential buyer, an attempt to recoup some of that money by selling the business for £120,000 fell through.

Mrs Kemp said: "Money is owed to the bank but we have personal guarantees on our overdraft facility which may involve the sale of our home to pay it back."But she added: "The sale of the assets will help us to meet our obligations with the bank and hopefully reduce the burden on us personally."

Last month we reported that former director Andrew Watson, who claimed he was still owed £2500 from the company, was concerned some of the equipment in the nursery attached to the play centre could have been transferred to Mrs Kemp's new company for below market value. However, she refuted those allegations this week.

Mrs Kemp, who accused Mr Watson of being "very bitter", said: "Separating the nursery from the play centre in January 2010 saved the jobs of 14 staff. The nursery was the one part of the business that was viable but it was carrying the play centre and if it went down it would take the nursery with it.

"With Scotia Kids up for sale it was necessary to rename the nursery which involved a new registration with the Care Commission. It could not operate under the name of Scotia Kids if Scotia Kids was no longer the provider, or worse, if Scotia Kids no longer existed. They worked really hard to supply this in under four months instead of the usual six months."

But she added: "Despite what Andrew Watson suggests, it hasn't necessarily saved it for me and my family. When the liquidation of Scotia Kids is complete, we have to buy the nursery from Scotia Kids and to do that and it will probably cost us our home."

It is understood that Edinburgh-based insolvency experts Invocas Financial were pressing ahead with the sale of the company's assets this week.

However, despite entering voluntary liquidation, Mrs Kemp believes Scotia Kids was still a good business.

And she revealed the directors even had plans to introduce laser quest to the play centre before it closed.

"It was a good business, well liked by customers and with great potential for the future," she said. "We knew that out of recession the business was viable. We had intended to add laser quest in the evenings for teenagers and adults."

But she added: "Unfortunately Scotia Kids has fallen foul of the credit crunch. We saw our numbers fall at the weekends from approximately 250 children through the door each Saturday and Sunday to only 150 on a good day, which means rain - when parents couldn't take their children to local parks for free."

Nevertheless, she added: "If someone came along with enough finance to sit out the recession and with the vision and drive to take it to the next stage, Scotia Kids could have survived."

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