Atlantic Computers plc (also Atlantic Computer Systems plc) was a British computer

lessor Lessor may refer to: * Lessor (leasing), the owner of leased property or the agent authorized on the owner's behalf * Lessor, Wisconsin, a town in U.S.A. * Lessor Township, Minnesota, U.S.A. See also * Lesser {{disambig, geo ...

and

technology services The quaternary sector of the economy is based upon the economic activity that is associated with either the intellectual or knowledge-based economy. This consists of information technology; media; research and development; information-based servi ...

firm, set up in 1975, that collapsed in 1990. Its fall also brought down its parent company British and Commonwealth Holdings, a financial services firm which had acquired it for £434 million in 1988. The company leased computers systems using complex 'Flexlease' agreements, which allowed a lessee to update to a new lease after a three years or to cancel the lease after five years. These terms made Atlantic vulnerable to large liabilities incurred if invoked which were often not covered by the value of the equipment itself. During acquisition talks, Atlantic misrepresented its

contingent liabilities In accounting, contingent liabilities are liabilities that may be incurred by an entity depending on the outcome of an uncertain future event such as the outcome of a pending lawsuit. These liabilities are not recorded in a company's accounts ...

and by the time of its collapse, had more than £550m in debt. While its American arm filed for

Chapter 11 bankruptcy Chapter 11 of the United States Bankruptcy Code (Title 11 of the United States Code) permits reorganization under the bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy, is available to every business, whe ...

on 5 July 1990, the British firm had been placed in administration with PricewaterhouseCoopers on 18 April. The group employed around 1,400 people at the time. A report into the failure of British and Commonwealth was set up by the Department of Trade and Industry and headed by Eben Hamilton QC and James Alexander Scott, an accountant. It found that Atlantic had never made a profit from its founding in 1975. After the report's release, three former directors of Atlantic (David Austin McCormick, Nicholas Scott and Sien Yen Cheng Kai On) faced disqualification at the behest of Michael Heseltine, then

President of the Board of Trade The president of the Board of Trade is head of the Board of Trade. This is a committee of the His Majesty's Most Honourable Privy Council, Privy Council of the United Kingdom, first established as a temporary committee of inquiry in the 17th centu ...

. McCormick later appealed his disqualification but it was upheld. Many creditors had to wait for almost a decade to recoup their money after the collapses caused a string of insolvency lawsuits.

References

{{Reflist Computer companies disestablished in 1990 1990 disestablishments in England Computer companies established in 1975 1975 establishments in England British companies established in 1975 American companies disestablished in 1990 British companies disestablished in 1990 Companies that filed for Chapter 11 bankruptcy in 1990