Creditors unlikely to get £6m back

Eiffel Steelworks Ltd
Eiffel Steelworks Ltd
0
Have your say

CREDITORS for a Wigan-based steel firm will probably be left more than £6m out of pocket despite the company being saved.

A total of 60 jobs were rescued when Eiffel Steelworks was bought by the only company to make an offer for it, William Hare Group.

The Ince-based company, famed for its work on the development of Liverpool One and Canary Wharf, crashed into administration in November 2014.

Adam Stephens of Smith & Williamson had been appointed administrator by the directors in October who decided to keep the business open so it could continue to fulfil existing orders.

But a newly published statement of their proposals, dated January 8, shows that William Hare Group paid more than £400,000 in December and a further £58,189 for work in progress, according to website Insider Media.

The latest report also shows what is likely to happen to creditors.

According to Insider Media, there is £800,578 available for distribution but unsecured creditors are claiming a total of £6.9m, of which £6.7m is due to related companies Eiffel Construction Metallique and Eiffel (UK). As a result, creditors are likely to face a total shortfall of approximately £6.1m.

Manchester-based partner of Smith and Williamson, Matthew Dunham, said: “It’s an updated report to let creditors know whether they’re going to get any money, whether they’re not going to get any money and how things are working out so it’s all aimed at helping them.

“Basically it was bought by the holding company five or six years ago.

“They’ve continued to pump money into the business over the years which is how that level of debt has built up. What they’ve done is continue to support the business but unfortunately they couldn’t make it work which is why they said enough is enough.”