Ernst & Young have been appointed administrator for Oldham-based engineering firm, DCT Holdings Limited, trading as DCT Holdings, DCT Plant Limited and DCT Civil Engineering. The company had been struggling with cashflow due to a legal dispute with Liverpool County council. They won the case, however the mounting legal costs caused the firm to struggle over the last few months and therefore were unable to continue trading.
The company has had to let around 100 staff go, leaving 13 to assist with the administration. Joint administrator of Ernst & Young, Tom Jack, stated ‘we are working with the directors and retained employees to try to preserve and sell contracts and maximise asset values for the Group’s creditors’.
While there has been some positive news about the engineering industry as a whole, it’s still a tough time for many. In this case, legal costs were behind the company’s short supply of cash so it’s a unique situation. The Close Brothers have predicted the engineering industry will flourish over the next few years, with the automotive industry building profits and boosting sales for the overall sector.
We’ve helped a number of engineering companies get back on track through Company Voluntary Arrangements (CVAs). In a particular case study, a company based in the Midlands successfully completed the CVA three years early: