ONE of Edinburgh’s largest private hire taxi firms is set to be liquidated, owing around £300,000 to Her Majesty’s Revenue and Customs.
A winding-up order has been lodged for Capital Cars Ltd for unpaid VAT but the jobs of 25 staff and 350 self-employed drivers have been secured after a phoenix company bought the assets of the collapsed firm.
Seven Sevens Cars Ltd took control of the private hire firm on Thursday and has retained the trading name.
An official liquidator has been appointed for the old company.
A petition to wind up Capital Cars Ltd was published on Tuesday in the Edinburgh Gazette. It is understood that despite “management restructuring” the company was unable to meet repayments of VAT totalling around £300,000.
Following legal advice, director Stephen Rose – who took over the running of the firm in August – decided to file for insolvency.
Staff at the firm’s Gorgie Road depot were alerted to the insolvency event yesterday but it is understood there will be no job losses.
In an e-mail to staff, director Stephen Rose said despite the financial collapse it was “business as usual”.And he moved to allay any fears about future job losses.
It read: “Capital Cars (Scotland) Ltd has gone through a necessary financial restructuring process.
“Seven Sevens Cars Limited has, as of yesterday, concluded the purchase of the entire ‘Assets and Undertakings’ of Capital Cars (Scotland) Limited, including the trading name.
“The old company has had an official liquidator appointed. Do not worry, the only changes that take place in the future will all be positive and all jobs remain secure.
“We will be starting an exciting and fairly aggressive marketing campaign in the near future that will ensure the continuing growth and success of the company.
“We will keep you all informed of progress.
“I cannot stress enough that there is no need for concern about the security of all your positions within the company and this turn of events means we can implement even more features and benefits of our services.”
Capital Cars – which is taking bookings and hasn’t been affected by the change – is thought to be the second largest private hire taxi firm in the city.
The firm won praise last year for prioritising bookings from women travelling alone throughout the year and for offering a text service to customers informing them of the make and licence number of the collection vehicle.
Last February, a lucrative £30 million contract to control Edinburgh Airport’s taxi rank was awarded to rival firm Edinburgh City Private Hire.
A spokesman for the HMRC said: “We can’t comment.”