Factory History > Hacienda that: Factory is dead, long live Factory
Article from Q Magazine on the death and apparent looming resurrection of Factory Records
The latest Manchester T-shirt says "Hacienda that". But is it?
After the great label's collapse under debts of more than £2 million in later November it looked all over. But as the New Year approached one or two voices from the very close "family" were suggesting that a Factory Mark 2 could be back in action soon.
The theory goes like this: New Order have a legally dubious but nonetheless written agreement with Factory (Q acquired a copy, see illustration) which implies that neither the band, nor the potentially mega-selling album they have in the can, nor their back catalogue are tied to the label in any way. That is, Factory's notionally most valuable asset doesn't actually belong to them.
New Order's legally dubious written agreement with Factory
"... the recordings. The group will have the right to inspect and audit the books at any time on reasonable notice.
The master tapes of the recordings and any out takes are to remain the group's property and should be delivered back to me as soon as possible after each recording. At the end of the term of the rights granted by this agreement you will have the right to sell off your existing stocks for a period of three months; thereafter you will either destroy all remaining stocks or at the group's option they may buy all or part of these stocks at cost from you.
With regard to licensing the recordings. either in the United Kingdom or abroad this may only be done ..."
Nonetheless, the Order and their manager, Rob Gretton, love the Factory ethos (Gretton, in fact, owns 31.3 per cent of it). So they will negotiate a huge signing-on fee from a major - maybe London, who nearly bought into Factory during '92 - but also insist that the basic elements of Factory, such as Tony Wilson, be fiscally resuscitated to handle key aspects of their career.
Et voila, Factory '93! The rose-coloured view also has the Happy Mondays coming back on board - on a contractual technicality concerning unpaid royalties, they bailed out of their deal just before the collapse to avoid falling into the receiver's hands.
Of course, hope for a speedy resolution of a bankruptcy is always likely to be misplaced. Moreover, whatever may be salvaged, many individuals and small companies who are owed tens of thousands will get nothing more than the usual derisory 5-10p in the pound payments.
The downside of Factory's abundant flair was hubris. Until 1988 it did business without contracts and lost James, The Railway Children and A Certain Ratio to other labels. On the A&R side, dance passed Factory by, while Hacienda DJ Mike Pickering showed what might have been with the deConstruction label.
Meanwhile, hundreds of thousands were spilled on the dim prospects of Tony Wilson's favourite, Cath Carroll, and Peter Hook's vanity project Revenge. Another damaging triumph of style over content was the move from the original Palatine Road offices. Instead of taking over ample vacant rooms above the Hacienda or, later, the Dry bar, Factory bought another building in Charles Street for £100,000 and spent £600,000 on transforming it into a wonder of arty décor. Now it's for sale and worth perhaps £250,000. Wilson's own remuneration reflects the company's inconsistent approach to finance. In Factory's bad years he would voluntarily work for nothing. Yet in the crisis year of 1991-'92, the advance budget plan anticipated that his salary - part-time, as Factory had always shared him with Granada TV - would be £36,000 (20 per cent more than any full-timer on the books), and his expenses (excluding phone) £3,000 per month, while his leased Jaguar cost £757 a month.
Still, all concerned feel that he and the label in general were fundamentally honest, that they simply lost the plot in hard times. As one source said, "They lost their creative austerity: the ability to sit in a plain office, drive a Ford Escort and make good albums for £10,000 a time."
But one optimist thought he'd spotted the best omen for the New Year: "Wilson's keeping quiet! Not saying a thing to anyone. I'm staggered. Something very significant is about to happen."