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Owen Pugh collapse sees 257 jobs lost

A total of 257 staff have been made redundant after North-east construction firm Owen Pugh called in administrators this week. 

Administrators Grant Thornton said all but one division of the North Tyneside-based group will cease trading after cashflow problems. 

Owen Pugh & Company, Owen Pugh Civil Engineering, Owen Pugh Contracts and HCS Drain Services have all ceased trading. 

Joint administrator Christopher Petts said it was “clear that the civil engineering contracting arm of the business was not viable and further trading could not be supported”.

He added: “Key customers highlighted that the insolvency of the group had triggered contract termination clauses.

“In turn, due to the interdependency within the group on these large civil engineering contracts, there was a knock-on effect on the viability of the plant hire and drain services businesses.”

The group’s former chairman John Dickson, who ran the business until August, told the Newcastle Chronicle: “I’ve gone through three years of absolute hell trying to keep the business going and I’ve done everything I possibly could to make things work, but it’s not been enough.

“We’ve had the most extraordinary bad luck and this is a particularly tough industry at a particularly tough time.”

Owen Pugh Aggregates, which operates Marsden Quarry near Sunderland, “continues to be maintained” while a buyer is sought, Grant Thornton said.

“All 30 employees at the Owen Pugh Aggregates site have been retained and are working with the joint administrators to help effect a going concern sale,” Mr Petts said.

The administrators have received “significant interest” from potential purchasers, he added. 

Nine other staff have been retained at the group’s head office “in the short term” to assist the administrators.

In its last full-year results to 31 March 2016, Owen Pugh Holdings recorded a pre-tax loss of £364,932 on revenue of £36.7m. 

In 2005, the group was acquired from the Pugh family in a management buyout, according to the firm’s website.  

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