Central Building Contractors collapses with loss of 148 jobs
Family-run Central Building Contractors (Glasgow) Limited has been placed into administration following years of “challenging trading conditions in the construction sector”.
Established in 1971, the Glasgow-headquartered company provided a range of construction design, development and maintenance services throughout Scotland, employing 159 people.
Administrators from KPMG said the company suffered from challenging trading conditions in the construction sector in recent years and 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 the company with a significant funding shortfall. All the firm’s projects have been closed for the previous five weeks in accordance with the Scottish Government’s coronavirus guidelines.
KPMG added that, as with most insolvencies within the construction sector, it is not possible for the company to trade in administration, even should the lockdown be removed in early course. As such, following consideration of all available options, the joint administrators Blair Nimmo and Geoffrey Jacobs required to make 148 employees redundant immediately following their appointment, with 11 members of staff being retained to assist with the administration process.
The joint administrators said they are rapidly exploring whether an early sale can be secured of some of the business and assets including 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) Limited 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.
“We will be working to support the employees and have already initiated matters with relevant government agencies to ensure the full range of support is available to all those affected.
“We would encourage any party who has an interest in acquiring any part of the business and assets to contact us as soon as possible.”
James McAlpine, director at Central Building Contractors (Glasgow) Limited, added: “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.”