150 job losses as Clugston enters administration

Firm hit by subcontractor’s insolvency

MORE THAN a third of the workforce at one of the North of England’s major construction and civil engineering firms has been made redundant after the company endured significant financial losses.

Administrators have been called in for the Clugston Group and 150 redundancies have been made following the losses on a number of large and complex energy-from-waste contracts which were heightened by the insolvency of a key sub-contractor.

Operating from over 25 sites, primarily across the North and Midlands, the business has companies involved in construction, civil engineering, logistics, property development and facilities management.

James Clark and Howard Smith from KPMG’s restructuring practice were appointed as the joint administrators to Clugston Group and Clugston Construction. Mr Clark and Chris

Pole from KPMG were also appointed joint administrators to Clugston Services. A KPMG spokeswoman said about 30 of the redundancies were in Leeds, Beverley and Hull, 100 in Scunthorpe and 20 at other sites.

Last month, Clugston Construction secured a £5.9m contract to renovate the headquarters of the West Yorkshire Combined Authority in Leeds.

In a statement, the administrators said: “Despite negotiations with key stakeholders to resolve issues caused by the losses, mounting pressures on the business have caused the directors to seek the appointment of administrators. Regrettably, 150 of the companies’ 412 employees have been made redundant.

“The joint administrators will continue to trade certain divisions and are seeking to sell valuable contracts, with 262 members of staff retained to assist with this.”

Mr Clark said the directors of the business tried to rescue the business and pursued discussions with a key stakeholder about a potential rescue deal.

He added: “Our focus over the coming days will be to seek buyers for the contracts and divisions, and to liaise with those employees who have been made redundant.”

Clugston Distribution Services and Clugston Estates are not affected and continue to trade.