Wed, 11 Oct 2017 | ADMINISTRATION
An engineering firm in the North East of England has called in the administrators - putting more than 300 jobs at risk – after cash flow problems hampered its profitability.
The Owen Pugh Group, which was founded in 1946 and has sites in Dudley, Blaydon, Stockton-on-Tees and Sunderland, ran into money problems after taking on loss-making projects.
Grant Thorton were summoned as administrators earlier this week, with Christopher Petts and David Dunckley taking control of the business’s fate.
Since then, most of Owen Pugh’s business units – Owen Pugh & Company, Owen Pugh Civil Engineering, Owen Pugh Contracts and HCS Drain Services – have ceased trading, with some 257 employees already being made redundant.
Owen Pugh Aggregates, which operates a quarry near Sunderland, is still running and its 30-person workforce kept on to help Grant Thornton find a buyer. Nine staff are also still working at Owen Pugh’s head office.
Petts said that he was hopeful a buyer might be found for at least part of the group, explaining that unsuccessful projects in 2017 had seen the firm’s cash position deteriorate significantly in recent months.
"Despite having sourced additional external investment during July 2017, cash pressure intensified culminating in parts of the group being presented with winding up petitions in recent weeks, which they have been unable to satisfy.
"I am working with the employees and customers to establish if there are elements that can be rescued, and a buyer located, in very short order."
A number of prospective buyers are reported to have expressed an interest in buying parts of the business and its assets.
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