KPMG administrators to Scottish building company
30 Apr 2020
KPMG partner Blair Nimmo and director Geoffrey Jacobs have been appointed as joint administrators of Central Building Contractors (Glasgow) Ltd, which has collapsed with the loss of more than 150 jobs
30 Apr 2020
Established in 1971, the privately owned, family run Scottish construction company provides a range of construction design, development and maintenance services throughout Scotland. Headquartered in Glasgow, it employed 159 people.
In recent years, the company has suffered from challenging trading conditions in the construction sector and has encountered reduced margins, contract disputes and delays in the commencement of a number of significant projects.
Despite the directors taking various actions to address the position, these factors left Central Building Contractors with a significant funding shortfall. At the time of KPMG’s appointment, in accordance with the government’s guidelines all the projects had been closed for the previous five weeks.
KPMG said that, as with most insolvencies within the construction sector, it is not possible for the company to trade in administration, even should the lock-down be removed in early course.
As a result, 148 employees have been made redundant immediately following appointment, with 11 members of staff being retained to assist with the administration process.
The joint administrators said they are exploring whether an early sale of some of the business and assets can be secured. The company’s assets include three freehold properties, numerous contracts, order book, work in progress and construction equipment.
Blair Nimmo, joint administrator and KPMG’s UK head of restructuring, said: ‘Central Building Contractors (Glasgow) Ltd has a rich history and is a well-known and highly regarded business in Scotland, but, despite the efforts of the directors, the business faced a range of cashflow challenges in recent times, which were amplified by the recent Covid-19 lockdown.’
James McAlpine, director at Central Building Contractors (Glasgow) Ltd, said: ‘Already difficult trading conditions have been greatly exacerbated by Covid-19 which has made our financial position unsustainable.
‘It is with significant regret that administration has been necessary.
‘We have been very fortunate to have loyal and hard-working staff, a supportive supply chain and professional partners, many of whom have worked closely with the business for a great many years.
‘We will work closely with the administrators to ensure every possible assistance is provided to all our employees during this exceptionally difficult time.’