Contractor collapsed owing £108m says administrators
Administrators of Buckingham Group Contracting have revealed the firm collapsed owing £108m to trade contractors and suppliers.
Grant Thornton’s report also says it’s unlikely that the 1,200 unsecured creditors will receive any money owed to them.
Midlands businesses were amongst those hit hardest by the news with Birmingham-based Tarmac Cement and Lime owed £2.8m and Walsall’s Fortel Services owed £1.9m. The group was also set to work on Birmingham City’s Tilton and Kop stands as well as Liverpool FC’s £80m Anfield Road stand extension.
£4.8m was left in the £700m-turnover group’s bank account with HSBC when it went under, which administrators are waiting to be transferred.
Administrators were appointed after HMRC rejected a request for the firm to have additional time to pay its bill. Grant Thornton did manage to then sell the group’s rail assets and its HS2 contract to Kier for £9.6m, rescuing around 180 jobs.
However, they announced the axing of 446 staff, after failing to find buyers for building, civil engineering, demolition, major projects and sport and leisure operations.
In the report, the administrators said: “As a result of the increasing losses being incurred on contracts and a lack of visibility on key cashflow matters such as HM Revenue & Customs (HMRC) Time to Pay [arrangements] (TTP) and contract adjudications, the advance rate on funding being provided through the company’s invoice finance facility was reduced to nil in July 2023.
“This, together with HMRC rejecting a proposal for a further TTP in August 2023 and increasing creditor pressure due to not being able to meet the full supplier/subcontractor payment run, resulted in Grant Thornton being engaged by the company on 16 August 2023 to explore a sale of business and assets.”
More than 20 parties are reported to have been contacted, but none were willing to provide additional debt finance to the company or keen to pursue a solvent purchase of the company’s share capital.
