Jobs saved as Ennstone go into administration
MORE than 1,000 jobs have been secured after Ennstone plc’s UK and Polish subsidiaries were bought out of administration this week for an undisclosed sum by a consortium of financial backers. The deal safeguards 100 quarrying jobs at Breedon and Cloud Hill, as well as a further 900 positions across the UK.
The company’s principal UK and Polish units have been sold to Breedon Holdings Ltd, a company headed by Vaughan McLeod –– Ennstone’s founder and former chief executive –– and backed by Barclays Ventures and a number of other financial institutions.
News of the ‘pre-packaged’ deal followed the appointment of business restructuring partners Nick Dargan and Matthew Cowlishaw, of Deloitte LLP, as joint administrators of Ennstone plc on Monday 9 March.
In a statement Ennstone said they had explored a broad range of strategic options over the past eight months, but despite the support of their UK banking syndicate, the deteriorating market conditions meant they had been unable to achieve a solvent restructuring of the Group.
Having already suspended trading on the London Stock Exchange in January, Ennstone’s shares have now been delisted. Shareholders are not expected to see a return on the sale of the UK and Polish units.
Commenting on the situation, the board of Ennstone plc said: ‘The Group has been facing the most challenging economic conditions for decades, which have reduced operational performance. These conditions have also prevented the Group raising the further financing it needed or from realizing disposals at prices which could have resolved the Group’s financial problems.’
Joint administrator Matthew Cowlishaw commented: ‘The slowdown in the house building and infrastructure sectors along with the lack of funding for potential acquirers has played a significant role in the Group’s difficulties. Securing a going concern sale of the UK and Polish subsidiaries, which will protect over 1,000 jobs, is positive news for the employees and the industry as a whole.’
