Telec Networks selects Quantuma for administration

UK fibre optics and utlilities infrastructure firm Telec Networks has fallen into administration, shortly after a major contract was postponed. Professionals from Quantuma will now work to sell off the company’s remaining assets.

For more than a decade, Telec Networks has played a key role in delivering broadband networks across the UK. With a head office in Grimsby, along with operations in Ipswich and Norwich, the firm reported a turnover of £24 million in 2022. The UK’s heightened inflation rates of the last 18 months seem to have taken a toll on Telec, however.

Many construction and infrastructure firms have seen the cost of materials balloon, as the nation has endured its highest price hikes in more than four decades. As costs have been passed on to the customer, a growing number of projects have been placed on hold or cancelled outright – and it is decimating the sector.

This seems to have hit Telec hard in recent weeks. In 2023, a £50 million project with CityFibre to deploy a new 10Gbps capable Fibre-to-the-Premises (FTTP) broadband ISP network across Norwich was mothballed, with sources warning it could be a “protracted suspension”. The project had commenced in September 2021, and was being supported by Telec.

With profits already declining, the contract may have acted as a catalyst for the firm. Managing directors Andrew Watling and Duncan Beat of business advisory firm Quantuma were subsequently appointed as joint administrators of Telec.

Fortunately, when the company ceased trading, all staff were transferred to a new employer – avoiding the need for redundancies. Instead, the joint administrators can now prioritise establishing the recoverability of sums due to the company, and find ways to maximise asset realisations for the benefit of the administration estate and the company’s creditors.

Watling commented, “It is unfortunate that Telec Networks has been forced to cease trading and enter Administration, due to a combination of challenging circumstances that reflect the difficult trading climate for many businesses in a number of sectors, where delays in starting contracts and late payment by clients inevitably lead to a squeeze on cash, which may be terminal if not addressed.”