THE decision to tear up the contract with a company wanting to redevelop the Barbican centre has been vindicated after the company called in the administrators.

Absolute Leisure, which is based in Gateshead, had signed the papers in December to begin work on a multi-million pound redevelopment of the Barbican.

The scheme would have seen the refurbishment of the theatre and the construction of new bars and restaurants to the front of the building. If it had gone ahead, York would have had the Barbican back and in use by this summer.

As part of the deal Absolute Leisure was asked to pay £3 million into a secure bank account by January 5. But the money was never paid in and a week later the council tore up the contract with the company. It has now been revealed that Absolute Leisure has called in the administrators with a view to selling some of its assets off.

The company owns various entertainment venues across the north east, including the Tuxedo Princess, a floating nightclub, and the New Angel Hotel and nightclub in Whitby.

Gerald Krasner, of administrators Begbie Traynor, said Absolute Leisure had been hit by the recession, the smoking ban, high alcohol duty and cheap supermarket booze.

City of York Council leader Andrew Waller said he had assumed Absolute Leisure was having financial difficulties. He said: “That they have gone into administration is not entirely a surprise and we now need to concentrate on moving the Barbican project forward. We have specialists in to help us, we have clear views as to what the building can be used for and the imperative is to bring it back into public use as soon as possible.”