340 jobs at risk as plant hire group enters administration
80 jobs have been lost and another 340 are under threat after one of the UK’s largest independent plant hire companies entered administration.
Hawk Plant (UK) and five of its subsidiaries are now under the control of administrators Sam Woodward, Alex Williams and Hunter Kelly from EY’s restructuring team.
Accounts signed off just 10 weeks ago, for 2017, showed a small profit for the £94m-turnover group and included no warning from the group or its auditor, KPMG, about a material uncertainty.
It described a “satisfactory performance” and while it did note the collapse of Carillion in January 2018 had caused “some timing disruption” to contracts, the company’s directors said they did not expect to lose out significantly because of the credit insurance that was in place.
However its administrators say the group, based in Whitchurch, Shropshire, had been struggling with the burden of weak demand and large costs.
Joint administrator Sam Woodward said: “The group’s cashflow had been impacted by a number of historical problematic contracts and a delay in the commencement of anticipated projects.
“Coupled with this, the group’s funding structure, with significant hire purchase and finance lease commitments put pressure on the cashflow at a time that asset utilisation was comparatively low.”
On appointment, administrators made 83 of the group’s 420 employees redundant.
The business had enjoyed a period of strong growth and was backed by £8m from the Business Growth Fund three years ago.
BGF created a charge against the company on Christmas Eve, just weeks after an intercreditor agreement had been lodged by Aurelius Finance, creating a debenture against some of the group’s assets. Aurelius, an alternative funder, had control of blocked bank accounts and oversight of four of the group’s major contracts.
These included its work on Hinkley Point C nuclear power station, the Lincoln Eastern Bypass, the Integra 61 development in Durham, and a contract with St Modwen.
The administrators have been appointed to Hawk Plant (UK) and its subsidiaries Hawk Plant Hire, Hawk Hire, Safety and Training, Hawk Plant, and Hawk Plant Sales.
Subsidiary Enverity, a ground survey and sight inspection business based in Newark, which employs more than 20 staff, remains solvent and unaffected by the administration.