Contractor Forrest has entered administration despite the sale of its refurbishment and energy divisions to Engie Regeneration.
The firm has appointed FRP Advisory as administrator having failed to secure refinancing for the main business after suffering losses on a number of problem contracts.
Anthony Collier and Ben Woolrych of FRP were appointed joint administrators earlier today.
Forrest employed around 230 people; however, 64 jobs are believed to have been saved due to an agreed sale of part of the business to Engie Regeneration.
Mr Collier said: “Despite the best efforts of the directors, the legacy issues facing the company have been unable to be resolved, resulting in an unsustainable financial situation.
“We have successfully agreed a sale of certain contracts to Engie Regeneration, which will preserve 64 jobs and provide continuity for customers in the refurbishment and energy divisions
“Unfortunately, it has not been possible to secure a sale for the construction and housing elements of the company, and we are working with all stakeholders to deal with the orderly wind-down of these divisions.
“We are pleased that during this process, working alongside management, we have assisted a large number of employees find alternative employment within the industry and will continue to work closely with agencies, including the Redundancy Payments Service, to ensure that employees receive every support at this difficult time.”
Forrest’s financial woes have stemmed from its new-build division, with the firm admitting in recent weeks that it had made a series of “incorrect preconstruction estimates for schemes”.
Earlier this week developer Elliot Group announced that it had replaced Forrest on its £100m Aura scheme in Liverpool. X1 Developments also cut ties with the contractor on its schemes, including The Gateway in Manchester and the £350m Chatham Waters scheme in Kent.
Construction News revealed earlier this month that the contractor had voluntarily withdrawn from a £200m framework while it worked on the refinancing deal.
After refinancing failed, Forrest’s announcement that it was looking for suitors for it’s two profit-making divisions was seen as a last ditch attempt to rescue the business.
According to its latest accounts for the year to March 2017, Forrest’s parent company Ensco 996 Ltd reported that the refurbish and respond division brought in revenue of £47.2m, representing 57.1 per cent of the business, with energy accounting for £9.6m, or 11.6 per cent.
Last month the contractor released a statement saying it had failed to secure refinancing and was exploring options for disposals.