Owners of collapsed oil refinery Prax Lindsey took £11.5m in pay and dividends

The Guardian

4 days ago

The married couple behind the Prax Lindsey oil refinery awarded themselves at least $15.9m (£11.5m) in pay and dividends in the years leading up to its collapse, it has emerged, as the government urged the company's boss to 'put his hand in his pockets' to help workers.
Winston Soosaipillai, who goes by his middle names Sanjeev Kumar, jointly owned the refinery with his wife, Arani, until it plunged into insolvency on Monday.
The failure of the refinery, which is one of only five left in the UK, has put 625 workers at risk and raised fears about disruption to supplies of customers such as petrol retailers and Heathrow airport.
The sudden demise of the company, which Westminster sources said had assured ministers of its health just weeks ago, prompted the government to order an investigation into 'the conduct of the directors'.
Sanjeev Kumar Soosaipillai is the sole director of both the refinery operation and its parent company, according to the latest available filings from Companies House.
The scale of rewards on offer to Soosaipillai and his wife, who is the group's human resources director, are revealed in a series of annual reports and Companies House filings.
The group paid a dividend of $5.2m to its shareholders in 2024, on top of a $2.1m payment in 2022, the documents show.
The Soosaipillais own 80% of the group directly and 20% via family trusts, indicating that they have extracted $7.3m in dividends since buying the plant from French oil company Total in 2021.
Pay disclosures also reveal the sums paid to the group's highest-paid director, understood to be Soosaipillai, given that he is the only director.
The pay deals were worth a combined $8.5m between 2022 and 2024, the only years for which accounts have been filed.
In total, the Soosaipillais appear to have handed themselves £11.5m in pay and dividends since buying the refinery in 2021.
Details of the payouts emerged after Mark Shanks, a junior minister in the energy department, called for Soosaipillai to help fund compensation for some of the 625 workers affected by the collapse.
Speaking in the House of Commons on Monday, Shanks said that the government 'expect[s] the owners to put their hands in their pockets and provide the support that those workers deserve'.
The division that houses the facility, Prax Lindsey Oil Refinery Ltd, has lost £109m over the same period, although this is not uncommon in large oil and gas operations, whose trading divisions often make up the difference.
Accounts also show that Prax was forced to revise the accounting treatment of one proposed dividend payment, after discovering it did not have enough cash to fund the payout.
During 2023, the Prax Group holding company declared and paid a dividend of $4.98m to its shareholders, the Soosaipillais.
These were paid 'in good faith', according to filings at Companies House, but the company later discovered that the payout 'exceeded the available level of distributable reserves'.
The sum was reclassified as an amount owed to the group by 'related parties'.
After the year end, a new dividend was declared, which accounts said would be satisfied by releasing the parent company from its obligation to repay sums already transferred.
The Guardian approached representatives of Prax, including one who has previously answered questions on behalf of the Soosaipillais, for comment.