Liverpool Council have been accused of ‘misleading the city’ over a deal in which they claimed to have taken control of the city’s markets for £1.
In 2016 the council bought Geraud Markets Liverpool Ltd, the company that ran the city’s markets. At the time, the board said it only paid £1 for the company which was renamed Liverpool Markets Limited (LML).
Councilor Malcolm Kennedy, then a cabinet member for regeneration, described the deal as a “turning point” for the city. However, it has now emerged that the deal involved the council waiving a significant debt owed to them by Géraud.
READ MORE: ‘Shock’ over multi-million collapse of Liverpool markets company
An LML financial statement published on Companies House explains that £515,073 was written off to enable the purchase of the shares. The board said “legacy” issues around market management will be looked at.
The document, published in December 2018, reads: “Geraud Markets (UK) was the parent company until September 2016. The prior period exceptional charge included in the statement of total comprehensive income includes £515,073 in respect of balances due from Geraud.group which were written off by the company as a condition of the purchase of shares held by Geraud Markets (UK) Limited.”
The report was signed by Darren Hardy, in his capacity as director of LML. Mr. Hardy was also a division manager in the city’s regeneration department at the time.
LML ran well-known markets such as St John’s in the city center and Great Homer Street in Everton. The company went into liquidation in May 2019.
Colin Laphan, chairman of the Liverpool Markets Traders Association, said: “Market traders across Liverpool have been stunned to find that the council has misled people by falsely claiming they have taken over the ‘markets’ for 1 £.
“While they already knew part of the deal was to write off over £500,000 of debt.”
Last week ECHO revealed LML owed the council millions of pounds following its collapse.
Companies House information records that the company was formed in 2003 and Liverpool Council took control of the company in 2016, buying all the shares. The December 2015 accounts showed a deficit of £965,330.
This deficit rose to £2,398,077 in March 2017. Latest figures released earlier this month show LML owes the council £3,469,896.00.
Mr Laphan expressed new concern about how the company had taken on so much debt in recent years.
He said: “Over the past few years, tens of millions have been collected by the marketplaces company, but there is no transparency as to where that money is going. We have been asking for service fee schedules since then. over 15 years.
“This is just one example of the lack of accountability and the hazy conditions around market revenue. Great Homer Street probably generated around £500,000 in revenue a year.
“As traders, we’ve all had one broken promise after another. Those in power seem to have forgotten their basic obligations to the community and need to be held to a higher standard.”
Liverpool Council announced the £1 deal in 2016, when a spokesperson said: “City Council today paid nominal £1 to take over Geraud Markets Liverpool Ltd and will now manage all day-to-day operations of the market with immediate effect.”
Speaking on behalf of the board at the time, Cllr Kennedy, who resigned as an adviser in October 2021 after moving to Spain, said: “This deal is a defining moment in the history of Liverpool markets. and guarantees that they will become a major asset again. in our thriving retail sector.
“As a city council, we are investing millions in upgrading facilities and the time was right to regain full control of operations.
“Thanks to this new agreement, we will be able to host, manage, promote and deliver markets internally and ensure a level of quality worthy of the new facilities in which we are investing.
“This new approach will provide current tenants, future traders and customers with a single point of contact that will allow us to improve the market offer at all farmers’ markets, international markets and Christmas markets.”
Councilor Harry Doyle, Cabinet Member for Visitor Culture and Economy, said: ‘Any legacy issues relating to the management of markets will be reviewed by officers and nothing will be spared.’ That’s why I’ve called for a review to reset our relationship with merchants going forward.”