Salford subbie felled after dispute with client, say administrators

A Salford subcontractor was felled after a dispute with a client on a major contract, according to the administrators’ report for creditors.

GPL was a collection of six companies working predominantly in civil engineering across utilities, rail and buildings and had a combined turnover of £26m for the year ending March 2017.

But in August the firm went into administration owing £6.4m – including £1.5m to the Greater Manchester Combined Authority, now headed by former Labour MP Andy Burnham and whose members include the 10 metropolitan boroughs that cover Greater Manchester.

In the report published earlier this month, joint administrators Ben Woolrych and Anthony Collier of FRP Advisory said: “Historically the group has traded profitably however during 2015 the group experienced pressure on cash flow following a dispute with a major customer on a key contract. The dispute has been ongoing since then.”

The firm made a pre-tax loss of £1.2m in its 2017/18 financial year and ceased trading soon after, despite a refinancing in spring.

One of businesses, Galvac, was sold by the administrator last month for £548,000, to a Bury-based company founded less than a month earlier.

But the administrators said unsecured creditors and some secured creditors – including GMCA – will not get their money back.