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Tue December 11 2018

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Funicular railway operator enters administration following safety closure

29 Nov The operator of the Cairngorm Mountain Funicular Railway has entered administration because of cash flow problems during an extended closure to investigate concerns about the structure supporting the tracks.

CairnGorm Mountain Limited operates the railway and associated visitor attractions but the railway has been shut for almost two months.

Highlands & Islands Enterprise (HIE) owns Cairngorm Estate and was in charge of operations from 2009 until 2014, when CML was appointed as operator for the resort following international procurement.

HIE chief executive Charlotte Wright said: “The directors’ decision to put CairnGorm Mountain Ltd (CML) into administration is an outcome that HIE had anticipated, and we are well prepared.”

She added: “Clearly, this is not the outcome that anyone wanted when CML became the operator.  However, with local support, we are confident that the situation can be turned around and we will see Cairngorm flourish again as a fantastic asset for this area, its economy and its people.”

Joint administrators, Blair Milne and Derek Forsyth, partners with Campbell Dallas, will continue to trade the business whilst progressing discussions with a potential purchaser for a sale of the business and assets as a going concern.

The 2km Cairngorm Funicular Railway opened on Christmas Eve in 2001 and carries around 300,000 tourists and sports visitors every year.  The funicular has been closed since the beginning of October to allow for a detailed assessment of the structure that supports the tracks.  These investigative works remain ongoing, said he administrator

The administration has been caused by unsustainable cash flow problems, said Campbell Dallas. Milne said: “Due to the extended closure of the Funicular Railway at Cairngorm Mountain, for safety reasons, the business has become unsustainably loss-making. The directors of the business had been in discussions to try to find suitable solutions, including a managed transfer of the business to another party, however those negotiations did not progress.  Under mounting cash flow and creditor pressures the Directors were left with no alternative other than to place the business into administration. The joint administrators will be seeking to achieve a sale of the remaining business on a going concern basis as early as possible.”

MPU

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