Tue, 05 Nov 2013 | ADMINISTRATION
Vital Services Group (VSG), a leading supplier of labour for rail, has entered administration after hitting cash flow troubles.
The Salford-based group hired Deloitte to take care of matters. Rival staff provider Morson Group has already stepped in and purchased the assets and contracts of the seven affected companies in the group.
The move has affected about 2,200 jobs but with no redundancies - the staff are to transfer to Morson Group. VSG directly employs 208 people in Manchester and contracts a further 2,000 other staff mostly in the rail industry.
The purchase will enable a smooth transition and minimal interruption for crucial services to the rail sector.
Established 30 years ago by John Smith, VSG supplies permanent and temporary staff to various industries and is the major supplier to Network Rail. It operates from 12 locations across the UK including Glasgow and London.
Joint administrator Dan Smith commented: "The group has suffered recently from cash flow pressures.
“The sale of the trade and assets of these companies minimises disruption in the continued delivery of these essential services to the rail industry and secures jobs.”
The seven companies to change ownership are: Vital Services Group Limited, Vital Rail Limited, Ematics Limited, Vital resources Limited, Quality Recruitment Limited, Vital Consulting UK limited and Vital Power (UK) limited.
Three other VSG companies are unaffected by the administration: Vital Skills Training Limited, Sicura Systems Limited and Vital Technology Limited.
The group was identified as being among the North West’s best Apprenticeship Employers in the regional final of the National Apprenticeship Awards 2013. It had a total of 346 apprentices earlier this year.
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