14p in the pound for Ocon creditors
CREDITORS of Ocon Construction are expected to get 14p in the pound, according to administrators.
Tim Askham and Robert Adamson from Mazars were appointed to the Manchester firm on March 7.
They said the company had been hampered by historic trading losses, continuing losses on contracts and difficulty finding new work.
But a £4.3m hole in the firm’s accounts is largely down to an £8.25m loan – plus £250,000 in interest – owed by its parent Opal Group which also went into administration last month after struggling to refinance £886m of debt with a syndicate of 14 lenders.
A creditors reports shows that £5m was repaid to Ocon in December but then immediately returned to Opal. Ocon’s total debts are £5.9m and there is around £1.5m to return to creditors. This does not include the Opal loan as administrators say it is “uncertain” whether this will be recovered.
Mr Askham said: “A review of the company’s financial position conducted by the board in February identified the funds needed for Ocon to be able to complete its contracts but these could not be obtained via its parent, Opal Group, which was unable to support the plan.
“Since March 7, we have been urgently engaging with clients and contractors to ensure an orderly handover of current works so that buildings can nevertheless be completed to schedule.”
The administrators will propose a return of 14p in the pound when they hold a creditors meeting on May 2.
Contracts on schemes at the University of Liverpool, Loughborough University and the University of Sussex have been handed over to the respective universities.
Some individual creditors will take a big hit, including Liverpool engineering services firm HE Simm, owed £350,000; Salford-based Demolition Network which is owed £207,000; Stockport cladding contractor Churchmore, owed £62,000; and Manchester ceilings and walls specialist Bluegyp, which is owed £50,000.
Some 64 people worked at Ocon. Mazars have kept on 14 to help wind down the business, 15 transferred to Liverpool University to handle the Crown Point scheme, and 33 were made redundant.
