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Buyers circle Rowecord Engineering structures business

Administrators Grant Thornton are in discussions with a handful of parties over a potential sale of the structures side of the stricken Welsh steel specialist Rowecord Engineering, Construction News has learned.

Two or three “potential parties” are understood to be involved in the discussions, although no offers have yet been made.

Several of the interested parties are understood to be overseas purchasers.

The structures team has worked on such prestigious projects as the Paddington Station redevelopment, 107 Cheapside and Cardiff City FC’s new stadium.

Rowecord Engineering is understood to have been stripped down to around 75 employees, with numbers declining each week as work in progress is completed.

The £68m turnover Welsh firm is the UK’s third largest steel specialist. It appointed Grant Thornton as administrators in April.

Up to 424 jobs were put at risk at the firm, though it is hoped a deal could see staff brought back on board.

The firm’s problems were put down to poor cashflow, a weakened order book and contract disputes – including one over the delayed £185m rebuild of Tata Steel’s blast furnace number four at Port Talbot, which was settled by the parties out of court.

Rowecord also turned down an offer of a commercial loan from the Welsh Government.

In profile: Rowecord Engineering

Founded in 1970, the firm has worked on high-profile projects such as the Aquatics Centre at the London 2012 Olympics, 107 Cheapside in London, the Paddington Station redevelopment for Crossrail and Cardiff City FC’s stadium.

In a letter to staff, seen by Construction News, Rowecord Engineering managing director Andrew Hoppe said he had “great regret” over the decision, and that the firm had “exhausted every option” to sustain the business, but would now be looking at mitigating the effect on the workforce.

Mr Hoppe continued: “We are proud of all we have achieved over 40 years of trading and I’d like to take this opportunity to thank our customers, suppliers and other business partners.

“This is a very sad day. We are a family-run company and have a hugely committed, highly capable workforce.”

Rowecord Group is the UK’s third largest steel specialist and had a turnover of £68m in 2012, up from £38m in 2011.

The firm made a profit of £3m in 2012 – up from a loss of almost £5m in 2011 – with net assets valued at £12m.

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