North-east-based construction firm Owen Pugh Group has called in administrators leaving more than 300 jobs under threat.
Civil engineering group Owen Pugh, which dates back more than 70 years, has been forced to call in administrators from Grant Thornton following several months of struggling with cash flow pressures, triggered by work on costly high-profile projects.
Christopher Petts and David Dunckley of Grant Thornton UK were appointed joint administrators of the company yesterday (9 October 2017).
Grant Thornton is hoping to find a buyer for the firm or parts of the group and a number of potential purchasers are understood to be interested.
“The group has experienced significant cash flow pressure in 2017 as it embarked on a number of large and high-profile projects which have, ultimately, proved to be commercially unsuccessful," said Petts.
"This has seen the cash position deteriorate significantly in recent months.
"Despite having sourced additional external investment during July 2017, cash pressure intensified culminating in parts of the group being presented with winding up petitions in recent weeks, which they have been unable to satisfy.
"I am working with the employees and customers to establish if there are elements that can be rescued, and a buyer located, in very short order."
He added: “A number of prospective purchasers have already expressed an interest in acquiring parts of the business and assets of the group, which we are urgently exploring, although as I have explained to the employees immediately upon my appointment, I am unable to provide any certainty as to how these discussions will progress, or any guarantees as to their future employment prospects with the group.”
Owen Pugh Limited announced last month that it was taking steps to restructure its business which would 'likely involve a number of redundancies.’
The company’s work varies from road and bridge construction, ports, harbours and sea defences, industrial facilities and office parks to urban renewal and environmental improvements, land reclamation, remediation and environmentally sensitive schemes.