Debt-stricken plant hire firm appoints EY as administrator

28 February 2019 2 min. read
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Over 200 jobs remain on the line after plant hire firm Hawk Plant collapsed in January. Following their appointment, EY administrators were quickly able to secure more than 100 jobs by way of a partial sale.

When Hawk Plant, one of the UK’s largest independent plant hire companies, fell into administration earlier in 2019, it came as a shock to many employees and executives. Accounts for 2017, which had been signed off just 10 weeks previously, showed a small profit for the £94 million-turnover group. The accounts contained no warning from the group or its auditor, KPMG, about a material uncertainty.

In fact, the release detailed a “satisfactory performance” at the firm, and while it did cite the downfall of Carillion in January 2018 had caused “some timing disruption” to contracts, the company’s directors said they did not expect to lose out significantly, thanks to credit insurance which was in place. Since the appointment of administrators from EY, however, it has come to light that the Shropshire-based group had been struggling with twin burdens of weak demand and large costs.

Debt-stricken plant hire firm appoints EY as administrator

According to EY’s assigned restructuring team of Sam Woodward, Alex Williams and Hunter Kelly, Hawk Plant’s deficit is estimated to be £52.6 million. The trio have also highlighted “the group’s funding structure, with significant hire purchase and finance lease commitments” as putting pressure on the group’s cash-flow “at a time that asset utilisation was comparatively low.”

With 420 people employed by Hawk Plant when it collapsed, a number of jobs are now understood to be at risk if a buyer is not found. Around 230 employees remain at the company, with 83 having already been made redundant, and 100 rescued by the sale of Hawk Plant’s assets at the Hinkley Point C nuclear power plant. There, machinery hire company Plantforce Rentals swooped in. Plantforce will take on all of Hawks’ site-based machinery, contracts and infrastructure. Now, the attention of the administrators turns to Hawk Plant and its remaining five subsidiaries.

The sale was agreed by Hawk Plant administrator Sam Woodward at EY. Commenting on the news, Woodward said, “I’m delighted to be able to complete this transaction and secure the on-going employment for Hawk employees in such a short timeframe. I wish Plantforce every success as they continue to support the development of this major infrastructure project.”