Firm which went into administration received £1.5m loan from council bosses
A company which went into administration earlier this month had received a £1.5m loan in a bid to keep it afloat.
At its height civil engineering firm GPL Group, which is based in Salford, employed about 300 people.
The company has been struggling for some months and recorded losses of £1.7m last year. It received the loan from the Greater Manchester Combined Authority in the spring.
The firm is understood to have suffered ‘significant cash flow difficulties’ due to delays with new and current contracts.
The administrators were called in ten days ago and are trying to sell the company and save the jobs of the 60 people who still work there.
A GMCA spokesman said: “The GMCA approved a loan of up to £1.5m in February 2018 to GPL Group (Manchester) Limited, following an application from the company.
“The application set out the company’s plans to safeguard up to 300 jobs in Salford, with potential for creation of further jobs through growth.
“The Greater Manchester Investment Fund Loan specifically supported the group’s working capital position and provided headroom for growth.
“Appropriate legal, commercial and financial due diligence is undertaken by the GMCA before investing in any company.
“All loans and investments made by the fund are also subject to on-going monitoring of a company’s financial position and progress towards their jobs target.
“The fund has successfully supported over 130 companies in Greater Manchester and helped to create or safeguard 7,150 jobs across the city-region.
“We will seek to recover all of our investment wherever possible. In the event that a company we have supported goes into administration the GMCA works closely with the administrators in order to maximise its return but leaves all options open in terms of recovering funds.”
Ben Woolrych and Anthony Collier, partners at FRP Advisory LLP, were appointed joint administrators.
The group includes subsidiaries GPL Civil Engineering, Galvac Limited, GPL Utilities Limited, GPL Plant Limited and GPL Special Projects Limited.
A statement at the time said: “The business had experienced significant cash flow difficulties in recent months due to ongoing delays with both new and current contracts, which meant the firm had no other option than to enter administration.”
“Continued issues and delays with contracts meant that it became financially unviable for GPL Group to continue trading.
“Our focus now is to find a suitable buyer for the business, while working closely with the directors to ensure that we achieve the best possible outcome for everyone involved.”
Last year the firm made losses of £1,718,519 compared to profits of £1,119,617 the previous year.
