{"id":809835,"date":"2024-12-03T22:13:08","date_gmt":"2024-12-04T04:13:08","guid":{"rendered":"https:\/\/newsycanuse.com\/index.php\/2024\/12\/03\/isg-supply-chain-to-get-no-money-from-administration\/"},"modified":"2024-12-03T22:13:08","modified_gmt":"2024-12-04T04:13:08","slug":"isg-supply-chain-to-get-no-money-from-administration","status":"publish","type":"post","link":"https:\/\/newsycanuse.com\/index.php\/2024\/12\/03\/isg-supply-chain-to-get-no-money-from-administration\/","title":{"rendered":"ISG: supply chain to get no money from administration"},"content":{"rendered":"
\n

ISG\u2019s administrators expect to recoup just \u00a335m towards a total of \u00a31.1bn of debt owed by the collapsed group, a new report by administrators at EY has revealed.<\/p>\n

The report said no funds are expected to be distributed to trade creditors, which are thought to be owed a total of \u00a3308m.<\/p>\n

The revelations came in an update report into eight ISG group companies, which employed a total of 2,380 people.<\/p>\n

Administrators estimate that HMRC is owed \u00a389.4m by the group and as a secured creditor it takes preference over claims from the supply chain.<\/p>\n

They estimate the tax authority will receive a proportion of what it is owed, but all figures are currently provisional.<\/p>\n

It is \u201chighly unlikely\u201d that there will be any funds available to pay trade creditors after that, it added.<\/p>\n

The report also shed more light on the events leading up to the collapse of ISG \u2013 based on information provided by its directors and EY.<\/p>\n

These include that after the collapse of the proposed sale of ISG to Antipodean Holdings<\/a>, discussions were held with an interested party that had earlier looked at buying ISG\u2019s fit-out arm.<\/p>\n

However, it walked away from the possible deal \u201cin a large part due to the uncertainty as to whether certain contracts would be successfully novated to the buying entity, as well as the material working capital required to fund the fit-out business\u201d, the report said.<\/p>\n

Two days later the group went into administration<\/a>.<\/p>\n

The administrators said that ISG had been experiencing problems since 2020 when it was hit by the impact of the pandemic and also \u201clegacy issues relating to large loss-making contracts in high-rise residential projects where significant additional time and higher costs were required to deliver projects\u201d.<\/p>\n

As a result of its efforts to recoup these costs from clients, it was involved in disputes worth \u00a3100m by the end of 2023, the report revealed.<\/p>\n

The firm was also rocked by the administration of Britishvolt, which led to the scrapping of a \u00a3300m contract to build its Northumberland gigafactory in January 2023, and then the suspension of the \u00a3600m Sunset Waltham Cross Studios project in Hertfordshire.<\/p>\n

\u201cThe combined impact of these projects not proceeding as expected negatively impacted cashflow and profitability,\u201d EY\u2019s report said.<\/p>\n

In 2023 it struggled to procure performance bonds, delaying some of its projects and further hitting its bottom line.<\/p>\n

It was required to provide cash-backed bonds for some of its jobs, which \u201cfurther exacerbated\u201d its liquidity issues.<\/p>\n

Draft accounts for 2023 show it made a post-tax loss of \u00a3133m on a turnover of \u00a32.2bn, EY said.<\/p>\n

At the beginning of 2024, the group took on a new strategy to bring in new capital, seeking to either sell its fit-out division or obtain funds following a refinancing of its parent company the Cathexis Group, according to the report.<\/p>\n

Some 11 parties had expressed an interest in buying the fit-out business by March, with one bidding on the company while carrying out due diligence and examining complex separation issues.<\/p>\n

The process was paused the following month when Cathexis received a bid for the entire group from investors under the banner of Antipodean Holdings, led by Andre Redinger and James Overton.<\/p>\n

However, that deal was called off on 17 September.<\/p>\n

The eight companies that are covered by the administrators\u2019 report are: ISG Central Services Limited, ISG Construction Limited, ISG Engineering Services Limited, ISG Fit Out Limited, ISG Interior Services Group UK Limited, ISG Jackson Limited, ISG Retail Limited, ISG UK Retail Limited.<\/p>\n<\/div>\n

Read More<\/a>
\n Ian Weinfass<\/p>\n","protected":false},"excerpt":{"rendered":"

ISG\u2019s administrators expect to recoup just \u00a335m towards a total of \u00a31.1bn of debt owed by the collapsed group, a new report by administrators at EY has revealed. The report said no funds are expected to be distributed to trade creditors, which are thought to be owed a total of \u00a3308m. The revelations came in<\/p>\n","protected":false},"author":1,"featured_media":809836,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[25237,4247],"tags":[],"class_list":{"0":"post-809835","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-chain","8":"category-supply"},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/809835","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/comments?post=809835"}],"version-history":[{"count":0,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/809835\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media\/809836"}],"wp:attachment":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media?parent=809835"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/categories?post=809835"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/tags?post=809835"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}