Teletext owner Truly Travel dissolved almost five years after folding

Truly Travel, which traded as Teletext Holidays and Alpharooms, and parent Truly Holdings were finally dissolved this month, four and a half years after going into liquidation.

The company folded in November 2021 after the Competition and Markets Authority initiated legal action over a failure to pay £1.2 million in refunds to consumers due to Covid-era cancellations and Truly lost its Travel Trust Association (TTA) membership.

Liquidators Robert Cundy and Bijal Shah of Edge Recovery issued final reports on both companies last November.

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They reported Truly Holdings held assets with a ‘book value’ of £9.5 million held by group companies at the point of liquidation but estimated these would “realise nil”, while Truly Travel had insufficient funds to pay more than £10 million worth of claims from 32 unsecured creditors.

The liquidators received a claim against Truly Holdings for £4.9 million from lender Santander UK, for which it held security, and further claims for more than £5.5 million from unsecured creditors. Expected claims for a further £3.7 million did not materialise. However, the liquidators noted there would be no payout in any case.

Truly Travel was owed £4.9 million in refunds by accommodation providers and tour operators when it folded – money claimed by the TTA to offset the amount owed to consumers.

An additional £728,000 in third-party funds to Truly Travel was received during “the course of the liquidation”, of which £405,000 was paid to the TTA as the company’s only secured creditor.

All consumer claims were dealt with by TTA Travel, part of The Travel Network Group.

Truly Travel’s Statement of Affairs following its liquidation had noted funds totalling £456,000 were held in a TTA trust account – considerably less than the money owed to consumers.

Association of Atol Companies advisor Alan Bowen suggested at the time this showed up “a real flaw” in trust accounts, arguing: “The trust account should in theory have had enough money to refund.”

He blamed “the system of allowing payments to suppliers at the time of booking and then insuring against their failure”, saying: “It calls into question whether trust accounts that allow you to pay suppliers work.”

However, The Travel Network Group chief executive Gary Lewis noted: “Holidays will go ahead as planned. Bookings are financially protected.”