Most existing staff to be transferred to new owner
Failed offsite schoolbuilder Eco Modular has been bought out of administration by Spatial Initiative Ltd.
The Hull-based construction business, which has been in operation since 2011, filed an administration notice roughly a month ago and later appointed PwC to oversee the process.
Joint administrators Jane Steer, Tim Higgins and Peter Dickens said the sale of the business, for an undisclosed fee, represented “the best option available” to creditors, to whom Eco Modular owed £5m, given the “severely limited timescales”.
The “vast majority” of the company’s 65 employees will be transferred to the buyer, PwC added.
Latest accounts for Eco Modular for the year to December 2021 showed a turnover of £33.5m, along with a pre-tax profit of £244,000.
Explaining its decline, the administrators said the group had experienced “a series of challenges” from 2020 which meant it required additional funding to continue trading.
“Throughout 2022 the Group continued to experience significant delays on projects, resulting in operating losses, eroding the working capital available to the Group,” they continued.
PwC was appointed to review its cash flow and carry out an independent business review last August, which resulted in a decision by the firm’s management that a sale was the most appropriate course of action.
Steer said: “The completion of this transaction provides much needed certainty to over 50 members of staff after a period of understandable concern following the Group’s challenges over the past months.”
In its last set of accounts for the year to December 2021, Manchester-based Spatial Initiative had a turnover of £18m and a pre-tax profit of £669,000.
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