Cost of Cleveland Bridge administration doubles

Administrators for Cleveland Bridge have revealed that the cost of dealing with the steelwork specialist’s collapse has more than doubled to over £460,000.

FRP Advisory was appointed last July when the 150-year-old firm, best known in recent years for its work helping rebuild Wembley Stadium, sank into administration owing creditors nearly £22m.

In a progress report filed at Companies House this week, FRP said that the expected cost of the administration had originally been estimated at £207,000.

But increased expenses, such as site security, IT costs and energy bills, has meant the bill now stands at £468,000

Debt collection costs doubled to over £60,000 and site security expenses went up from £4,000 to nearly £93,000. PR costs jumped from an expected £4,000 to £9,500 after “more queries than anticipated were received from the media”.

However, FRP said it brought in more than £5m from the sale of Cleveland Bridge’s long leasehold properties while an auction of the firm’s plant and equipment raked in a further £1.1m at the end of last year.

It said the decision for the company to continue trading until the middle of October last year brought in additional money, including a £500,000 bond from an overseas customer, which FRP said would have been “unlikely in the event that the company had ceased trading immediately following the administration”.

Secured creditor, finance firm 4Syte, which provided the contractor with £4m of emergency funding last June before calling in FRP a month later, has had its near £3m debt repaid.

But another secured creditor ARPIC, the Saudi Arabian oil and gas business which owned Cleveland Bridge for close to 20 years, has not been paid any money yet. FRP said it expects ARPIC’s claim to be between £6m and £8m but “they have not yet proved [it]”.

Cleveland Bridge’s 227 staff, who were owed £400,000 in missing wages, holiday pay and pension contributions, have also been paid back.

Unsecured creditors due a total of around £8m have again been told not to expect any money back following the collapse.