Financial difficulties spark administration for energy broker
14 Feb 2019
Andrew Johnson and Chad Griffin, senior managing directors of FTI Consulting, have been appointed as joint administrators of energy consultancy Utilitywise (UTW), which has failed to find a buyer after reporting difficulties in refinancing earlier this year and has now ceased trading, putting around 1,000 jobs at risk
14 Feb 2019
UTW is the AIM-listed holding company of the Utilitywise group and the trading entity for the group’s enterprise division, which provided energy and utility brokerage services to micro-market and SME businesses customers.
In a statement, the company said: ‘After extensive discussions with the group’s largest shareholders and other stakeholders, the directors of UTW were unable to raise sufficient funding to cover trading losses and implement the turnaround strategy required by the enterprise business.
‘Furthermore, the formal sale process for the group announced by the board on 28 January 2019 did not result in any offers to acquire the enterprise division, or the group as a whole. Consequently, the directors of UTW sought the appointment of administrators at UTW.’
All other group entities remain outside of an insolvency process and continue to trade as normal.
Following his appointment as administrator, Andrew Johnson of FTI said: ‘Given the absence of a potential purchaser for the enterprise division and the continuing significant losses within that part of the business, we are unable to continue to trade, and will cease the operations of the enterprise division immediately.
‘This will unfortunately result in a substantial number of redundancies, primarily at UTW’s head office in Newcastle.
‘We have received expressions of interest from a number of parties for UTW’s subsidiary companies Icon Communication Centres and Energy Intelligence Centre, which operate the Europe division and corporate division respectively.
‘These companies are not in an insolvency process and continue to operate on a “business as usual” basis, with the full support of the group’s lender, while the sales process continues. We intend to conclude the sales processes in respect of these subsidiaries in the coming weeks.’
Last month, UTW’s founder Geoffrey Thompson said it needed £10m to keep its business afloat, after coming up against ‘unexpected challenges and legacy issues’.
Report by Pat Sweet