A PROMINENT Hampshire builder which went into administration earlier this month owed around £16million to unsecured creditors who are unlikely to see any of their money.
All 107 jobs at Brymor Construction were saved when its business and assets were sold to Winchester-based Portchester Equity.
But an update from administrators reveals that most creditors are set to lose out – and that staff are owed more than a month’s pay.
READ MORE: Buyer steps in to rescue building company behind Saints' new gym
Brymor’s high-profile developments include Southampton’s Horizon Cruise Terminal.
It also had the contract to build Southampton FC’s new gym at its Marchwood training ground. The company was working on around 13 sites at the time it went into administration.
To read the full report by administrators on Brymor Construction Ltd, click below:
The administrators’ report says new ventures owned by Portchester will pay £1.75million for the assets of parent company Brymor Group, which owns the Denmead-based business’s properties, and paid £400,000 for those of Brymor Construction Ltd.
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Joint administrators Michael Magnay and Mark Firmin, of Alvarez & Marsal, wrote: “The group has historically traded profitably, achieving annual turnover of £82m and net profit of £1.1m in the year ended March 31, 2019.
“However, more recently, the group has experienced difficult trading conditions due to the impact of Brexit, Covid-19 and cost inflation in the construction sector.
“These recent difficult trading conditions resulted in net losses being generated by the group since 2020.”
Project delays from the second half of 2021 left the group with more cash going out than coming in.
Brymor’s bank Santander refused to allow it more borrowing and it became unable to pay subcontractors and suppliers.
“The directors determined that as a consequence subcontractors and suppliers would stop attending project sites, and therefore ongoing work on project sites would quickly cease,” the report says.
“The group was unable to meet its liabilities as they fell due. Further, there were concerns that safety on sites could become compromised should subcontractors or suppliers attend sites seeking to recover goods.”
Brymor Construction was unable to meet its payroll on June 30 and no staff were paid between June 1 and administrators being appointed on July 8.
The report says Brymor Construction faces a shortfall to creditors of £19.1m, with £2m owed in VAT and an estimated £14.8m to unsecured creditors. The parent company owed another £1.25m to unsecured creditors.
“Based on current estimates, it is highly unlikely that there will be a dividend to unsecured creditors,” the report says.
READ MORE: 107 jobs saved with sale of builder behind Saints gym and cruise terminal
Portchester Equity had offered to buy the companies before they went into administration. But it withdrew the offer after Alvarez & Marsal made “a number of necessary adjustments to historic trading results”.
After the business went into administration, Alvarez & Marsal contacted 116 parties about buying them, but Portchester was the only one to submit an offer. It bought the businesses through a new venture with four Brymor directors on the board.
Among the creditors thought to be owed tens of thousands of pounds are 3D Personnel of Southampton, owed an estimated £35,046; CSW Cladding of Rownhams, £62,136; E Williams Landscapes, Hythe, £27,695; and Premier Recruitment Solutions, Southampton, £67,446.
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