MoD kennels row hits Parkwood

PRESTON-based Parkwood Holdings, which manages golf courses, swimming pools and also runs some PFI contracts, has put one of its subsidiary businesses into administration.

Realm Services, a special purpose company set up to operate a PFI contract with the Ministry of Defence,  has been placed into the hands of accountancy firm BDO Stoy Hayward after “close discussions” with Barclays Bank.

The administration is a consequence of a dispute with the MoD relating to the kennelling of dogs trained at the Defence Animal Centre in Leicestershire.

A statement from Parkwood said the administrators, Shay Brennan and Tony Nygale, would seek to negotiate satisfactory terms to resolve the issue.

“The directors and Barclays believe that placing Realm into administration is the best course of action since it invokes a 150 day suspension period to the contract which should allow time to reach a commercial resolution to the outstanding contractual issues.”

Barclays Bank provided senior debt of £6.5m to Realm which signed a PFI contract with the MoD in August 2000.

Realm is responsible for the provision, management and maintenance of a new headquarters building, which includes offices, messes and new single living accommodation.

Parkwood, which also manages swimming pool and leisure centres, said it would give more information about the matter when it publishes its half-year results on August 28.

Shares fell 4% to 36p on the news.