Dividend blow for Haymills creditors

SUB-CONTRACTORS left out of pocket after the near collapse and subsequent takeover of Suffolk construction firm Haymills are to receive only a “very small dividend”, it has emerged.

Elliot Furniss

SUB-CONTRACTORS left out of pocket after the near collapse and subsequent takeover of Suffolk construction firm Haymills are to receive only a “very small dividend”, it has emerged.

Dozens of small businesses from Suffolk and the surrounding counties are owed hundreds of thousands of pounds for completed contracts - debts that will not be repaid through the takeover arrangement made by administrators PricewaterhouseCoopers (PwC).

The ailing Haymills Group, which has a base in Stowmarket, was placed into administration in August before the majority of the businesses within the group were sold to Vinci Construction UK Ltd, part of Vinci, an industry giant based in France.

The buyout included the business assets of the group's Property Solutions and East Anglian Projects businesses, which saved the jobs of more than 430 of the group's employees.

However, the purchase of the businesses did not include any of the Haymills Group's debts, save for taking on the debts associated with employee contracts.

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This arrangement left unsecured creditors - including sub-contractors - to lodge individual claims with the administrators.

Last night Stephen Oldfield, of PwC, said that because of the size of the claims made it was likely that creditors would only receive a very small dividend - and that could take many months to materialise.

He said: “The reason why the dividend is small, in (the case of) Haymills Contractors Limited, is because 126 people lost their jobs and the 126 needed to be looked after as preferred creditors. That's one reason why there is only a small dividend.”

He said there were also “very big claims” elsewhere in the group and the fact that the London and South operation did not sell meant there was less money available.

He added: “Of course the outcome for creditors is very disappointing. The claims against the company are very considerable. It's very difficult. From the employees' perspective it's good news - (but) for the sub-contractors it's not such good news.”

The owner of one family-run firm, who asked not to be identified, said he was owed a six-figure sum for work completed for Haymills dating back several years.

He said staff were now working a three-day-week in a bid to keep them on the books at a time when there were very few new contracts coming in.

He said: “Lots of companies have been taken for money and are now suffering. I've spoken to people from these other companies - it's all negativity.”

The businessman added he had received a letter from PwC telling him that the prospects of receiving any dividend were “very poor”.

The company, which supplies bespoke items for construction projects, will be represented at a creditors' meeting in Norwich later this month when all sub-contractors affected by the deal will be told the news officially.

Last night nobody from Vinci was available for comment.

nHave you or your business been affected by the Haymills takeover? If so, call 01473 324734 or email reporter Elliot Furniss at elliot.furniss@eadt.co.uk.