Henry administrator begins legal proceedings over £10m director payment

The administrator of collapsed London high-rise builder Henry Construction Projects has started legal proceedings to recover £10m paid to a former director before the firm sank into administration more than 18 months ago.

According to an update from FRP Advisory, £10m was paid to parent Henry Group Holdings in January 2023.

It said that Holdings paid the sum to a minority shareholder in Holdings who was also a director of both companies in May 2023. Henry Construction Projects went into administration the following month.

FRP said that last June it “became aware of the identity of the recipient of the payment from Holdings…and immediately wrote to their solicitors demanding repayment of the £10m. The individual did not repay the funds.”

FRP said the parties agreed to ringfence the £10m in question “pursuant to agreed undertakings provided by the bank and the individual”.

It added: “Following the £10m being frozen, administrators issued proceedings against certain parties in order to recover the monies for the benefit of creditors.”

It said litigation was ongoing “and further updates will be provided in future progress reports”.

In previous updates, FRP said it took four months to download the firm’s electronic records and criticised Henry’s record keeping. It added the firm had “numerous bank accounts”.

Henry collapsed owing dozens of firms a total of more than £43m with eight firms each owed more than £1m.

In its last set of accounts, Henry Construction Projects posted an improved turnover of £402m in the year to June 2021.

The figure was up 7% on the previous 12 months with pre-tax profit during the period up 8% to £14m.

As well as high-rise, the firm also carried out civils, groundworks and reinforced concrete work.