Western Isles Council has moved to ensure fans who bought tickets for the Midnight Sun Weekender will get refunds.
The local authority – which had opposed the winding-up order of the organisers – has met again with them and said it was keen that fans were refunded.
The festival firm recently dramatically withdrew its application to be struck off.
Ticket sales forced Midnight Sun Weekender cancellation
Midnight Sun Weekender was meant to close in Stornoway last month with Credence Clearwater singer John Fogerty with The Pretenders and Primal Scream also on the line-up.
But the event was cancelled eight days before it was due to start due to it not selling enough tickets.
Last month the firm running it – Midnight Sun Festivals Ltd – applied to be closed.
Directors applied to Companies House to have it struck off the register and dissolved.
Western Isles Council has confirmed it made a £150,000 loan to the company – but with unspecified guarantees.
A spokesman for the council said it had opposed the winding up of the company that ran the event.
He said: “We met with company representatives to seek assurances that both the council and fans who bought tickets would get refunded. We were assured that a structure is being put in place and will soon be implemented. We remain in dialogue.”
Fans anxious about refunds
The filing to wind up the company was issued in Companies House Gazette on May 30, and revealed that the Registrar of Companies was giving notice that, unless a cause is shown to the contrary, the company (Midnight Sun Festivals Limited) would be struck off the register and dissolved not less than two months from the date.
When that news broke, ticket holders for the Midnight Sun Weekender became worried that they might not see the refunds they had been promised.
Company directors Charles Clark and Ian Macarthur applied for the company to be struck off.
According to company records, a third director, Ariki Porteous, resigned on Monday, March 13.
Fans had taken to the festival’s now deleted Facebook to complain of the late decision which has cost them accommodation, flights and ferry bills plus taking time off work.
Organisers had previously revealed that half of the sales have come from off island.
Everybody who had bought a ticket would be refunded, said organisers.
Western Isles Council said stressed that it has been a long-time supporter of a range of festivals across the Outer Hebrides providing significant year-on-year grant support.
Organisers said cashflow and poor ticket sales was why the festival was axed.
The three day festival was said previously to have cost almost £1 million with other acts including Spiritualized, Public Service Broadcasting, Edwyn Collins, Honeyblood and Ocean Colour Scene.