After construction engineering company NMCN said it intended to appoint Grant Thornton UK as administrators, Liverpool City Council said it was seeking clarification as to what this would mean for the project.
NMCN was the main contractor for the Lime Street scheme, which will reduce the street to a single carriageway in each direction, increase public space and add a cycle lane. NMCN started work on the site in October 2020 and was supposed to be finished by mid-December. It is unclear how NMCN entering administration will impact the project.
“We’ve been made aware that the contractor for #LimeStreet may have entered into administration.
“Officers have been tasked with securing Lime St & making it safe, whilst we await formal confirmation. “We are seeking clarification to inform our next steps.” pic.twitter.com/bq2mGZBvBv
— Liverpool City Council (@lpoolcouncil) October 4, 2021
In a statement on the London Stock Exchange, NMCN – formerly North Midland Construction – said it was no longer able to continue trading after failing to refinance. The administration declaration applies only to NMCN and the NMCN Sustainable Solutions subsidiary. Other companies in the Nottingham-based group are unaffected.
NMCN had been attempting to recapitalise the company through a £24m fundraiser with Svella and other investors. It also wanted to renegotiate its facilities with Lloyds Bank. However, the fundraising and refinancing were conditional on finalising an annual report and publishing the company’s audited financial statements.
“Completing the preparation of the group’s accounts has revealed further underlying contractual issues with expected losses rising to £43 million,” NMCN said. “It has now become apparent that the company will be unable to approve the audited financial statements in a timely manner to allow the proposed transaction to complete within the required timeframe. This, in turn, has led to significant liquidity issues for the Group and particularly the Company, which unfortunately is now considered to no longer be able to continue trading as a going concern.”
NMCN did say that it had received offers from others to acquire its trading operations and subsidiaries and that discussions were underway.