Pochin creditors to lose out, administrators say
The estimated amount the collapsed Cheshire-based contractor owes has been revised down to £76m from £89m, but creditors could receive as little as 0.2p in the pound when the administration period ends next August.
Pochin paid off its £8m debt to NatWest Bank following the £3.25m sale of its eight-acre former headquarters in Middlewich, but contractors – some of which are owed six-figure sums – are expected to receive only a paltry return, according to the latest report from the company’s administrators at Grant Thornton.
Crewe-based commercial property firm Blok UK, advised by law firm Legat Owen, bought Pochin’s headquarters earlier this year.
Grant Thornton’s latest administration update reports that NatWest has now been paid in full but adds that unsecured creditors can expect to receive between 2p and 6p in the pound once the firm has been placed into liquidation, “subject to the realisation of funds from outstanding assets and debtors”.
Pochin is owed £13.5m from debtors and through retentions, of which £650,000 is expected to be recovered over the next 12 months, the report adds. This figure is down from the initial estimate of £950,000 outlined in the first administrator’s report, which was published last October.
The £13.5m is spread across 34 contracts, seven, or £5.8m, of which were live when administrators at Grant Thornton were appointed.
Legal claims relating to two contracts in particular are ongoing and the administrator is “pursuing the claims on behalf of the creditors”, the report added.
Pochin is also owed £13.1m by other group companies that are in administration, but “there will be no return on these claims”.
Pochin’s demise, reported by Place North West last August, was largely down to the problems of its construction arm and four problematic residential jobs, which led to estimated losses of around £17m across Pochin Construction.
As a result, the company was ultimately unable to continue trading, leaving many sub-contractors significantly out of pocket. Grant Thornton was appointed to all eight companies within the Pochin group.
Investigations into Pochin’s affairs have been ongoing since last November, when an additional administrator, BDO, was appointed to carry out this work.
Creditors last month agreed to give Grant Thornton an additional 12 months to wrap up Pochin’s administration, due to delays caused by Covid-19.