Plymouth travel firm Blue O Two saved after going into administration

Non-licensable part of business sold in pre-pack protecting jobs and 1,700 customers after Covid restrictions hit operations

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Retail & Consumer

William TelfordBusiness Editor, Plymouth Live

11:04, 18 NOV 2021
Updated11:28, 18 NOV 2021

Blue O Two's offices in Sandy Court, Langage, Plymouth, photographed in 2017 (Image: Google)

A Plymouth business which runs overseas diving trips has been resurrected after collapsing into administration when Covid travel restrictions meant more than £3m had to be refunded to customers.

Blue 02 Ltd, which traded as Blue O Two and was based at Sandy Court, Langage, folded, blaming the coronavirus pandemic for causing “the greatest challenge in 18 years of trading”.

Over the course of the pandemic, refunds totalling more than £3m were made to customers and without investment the business faced closure, which would have resulted in more than 3,000 customers being impacted.

But the brand has been saved by a pre-pack deal for the non-licensable part of the business, with Scuba Tours Worldwide Ltd, which shares two of Blue O Two’s directors, now trading as Blue O Two.

It means jobs are protected and the sale of the non-licensable part of the business helps to provide continuity for about 1,700 customers.

The majority of the company’s customers will therefore be unaffected by the administration and sale, with their booking simply transferring to the new owners.

All other customers will be able to claim a refund for their booking through either their ATOL protection or their credit card operator, or are protected by financial failure insurance, meaning no customer will lose the value of their booking. All impacted customers will be contacted by the administrators with instructions on how to make their claim. They can also visit blog.blueotwo.com/blue-02-ltd-administration-customer-info.

However, some people who booked holidays may still face problems and the Blue O Two website said: “We regret that certain bookings that have not departed may be cancelled.”

It added: “Whilst this news may be upsetting for you, please be assured if your holiday was booked with Blue 02 Limited, we are here to help you.”

The company, which employed 27 people and had net assets of £893,764 pre-pandemic, specialises in diving holidays to exotic foreign locations such as Indonesia, Thailand and Bikini Atoll . Since 2003 it has facilitated more than two million dives for customers.

The company said the ��Ƶ’s stringent, and constantly changing, Covid travel restrictions - which saw key destinations in Egypt and the Maldives on the “red list” for a lengthy period - made it “almost impossible” to deliver diving experiences and some customers had holidays rescheduled more than once.

Nathan Tyler, co-director of Blue O Two, said: “The Covid-19 pandemic presented the travel industry, and us, with the greatest challenge in history.

“Travel is a complex regulated sector, and a lack of tailored support, along with the ��Ƶ having the most stringent of travel restrictions has left it decimated.

“Before Covid, our business was a high growth success story. Despite our best efforts and determination, the financial impact of the pandemic became too great and we were forced to restructure our business.”

In a joint statement with fellow director Jason Strickland and Mr Tyler said the pair had suffered “many sleepless nights” and had done everything they could to keep the Blue O Two brand alive.

Its ATOL licence, for flights, was recently renewed by travel industry regulator Civil Aviation Authority (CAA), but conditions were imposed on this licence and subsequent changes to ATOL licensing requirements resulted in the business being unable to meet its financial obligations as they fell due.

The directors said: “This, as well as refunding many millions of pounds, has made it difficult for the directors to see a way forward for Blue 02 Ltd which protects the interests of our customers in the current Covid climate.”

They added: “Given the financial damage caused by the pandemic, and despite our relentless best efforts to save Blue 02 Ltd, unfortunately, and with regret, the decision was made to cease trading on November 15, 2021.”

Andrew Sheridan and Simon Stibbons, partners at business advisory firm FRP, were appointed as joint administrators of Blue O2 Ltd on November 15 and immediately completed the sale of the non-licensable part of the business to Scuba Tours Worldwide Ltd.

Mr Strickland and Mr Tyler said how delighted they were that the Blue O Two brand “lives on under Scuba Tours Worldwide Ltd – which now trades as Blue O Two”.

They said: “We will continue to operate and provide scuba diving liveaboard holidays with the same devoted team of people. As such, we will be able to provide some existing holidays booked with Blue 02 Limited as planned, to some customers. “

They added: “We have opened our hearts to you many times over the years. We have been on many journeys together. And we will continue to dive the world together.

“ We sincerely apologise for the inconvenience and disruption this situation has caused. We can only hope for your understanding and continued support as we recover from the unprecedented challenges of Covid.”

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Business Live's South West Business Reporter is William Telford. William has more than a decade's experience reporting on the business scene in Plymouth and the South West. He is based in Plymouth but covers the entire region.

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Mr Sheridan, joint administrator, said: “This has been an incredibly tough time for the travel industry with even well-established businesses like Blue O Two facing significant challenges. We’re therefore delighted to have secured a sale of the non-licensable part of the business, which saved the jobs of all of the employees and protects holidays for 1,700 customers. We wish the owners every success in taking the business forward as the market continues to return to some normality.”

Mr Tyler said: “Amongst our professional advisory team, FRP have been instrumental in helping the business achieve a solution that not only protected jobs, but also protects 1,700 customers, and keeps our life’s work alive. We would never have had the opportunity to take the Blue O Two brand forward if it were not for FRP.”