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Cash woe for fit-out subbies

Administrators warn failed Bellwater's unsecured creditors they will be paid only 10p in the pound

FIRMS chasing money from failed fit-out company Bellwater are set to lose the lion's share of their cash, creditors heard last week.

At a central London meeting last Wednesday PricewaterhouseCoopers partner Michael Gercke told representatives that minimal funds would be available for unsecured creditors. It is understood that just 10p in the pound will be returned for the firms left out of pocket by Bellwater's failure.

According to a statement of affairs prepared by the administrator, Bellwater left total debts of nearly £3.9 million.

Trade creditors were owed £2.7 million, while the firm also held more than £300,000 in retention payments from subcontractors.

But PwC partner Michael Gercke said that these figures were likely to increase when the firm examined outstanding claims.

The company will remain in administration for the near future while PwC collects outstanding debts before the firm is wound up and proceeds distributed to creditors.

The collapse of Surrey-based Bellwater follows the failure of two other major players - Benson and Spectrum - in the fitout sector in the past six months Bellwater went into administration in January with the loss of 55 jobs just weeks after one of its subsidiaries went under in Sweden.

The firm, formed in 1991, specialised in fit-out work for IT and data centres but had been targeting other sectors after its core work began to dry up. It recruited a new managing director to spearhead a push into more commercial work.

Mr Gercke said: 'The firm was turning over around £100 million at one point but was hit badly by the fall-off in communications work in 2001 and 2002.

It tried to widen its market but found commercial work very competitive.'

The latest accounts, for the year ending September 2002, show turnover falling from £61.6 million in 2001 to £37 million.

Profits fell from £2.6 million to a £2.8 million loss.