‘Loss-making contracts’ downed Scottish firm McGill

Scottish contractor McGill collapsed after it was hit hard by a number of “loss-making contracts”, administrators have revealed.

The Dundee-based firm, which entered administration last week, also struggled with the after-effects of the coronavirus pandemic and material price inflation, which hit its finances.

This was despite the group receiving funds from the government-backed Coronavirus Business Interruption Loan Scheme during the pandemic, according to administrator Leonard Curtis Business Rescue & Recovery.

Barry Stewart and George Lafferty were appointed as joint administrators for McGill, which operated mainly in the specialist services of refurbishment and fit-out. The firm is registered on Companies House as McGill Facilities Management Ltd.

Administrators have, however, been able to sell McGill’s fire and security division in a prepack deal to Galashiels-based firm SPG Fire & Security Ltd – saving a number of jobs in the process.

At the time of publication, Leonard Curtis was unable to quantify the number of jobs that have been saved, following a request by Construction News.

Concerns about McGill, which employed about 50 people, had been swirling for several weeks since it reportedly asked workers not to come in after it lost its working-capital bank facility.

CN also asked about the prospect of selling the rest of the business off, but received no reply to that query.

However, McGill director Errol Lawrie said: “Whilst it is disappointing that we were unable to save the whole business, it does give me some comfort we were able to save this division and a number of local jobs.”

Leonard Curtis director and one of the appointed administrators, Barry Stewart, said the sale of the division would “assist in maximising realisations for creditors” and protect a number of jobs.

At the time of its administration, McGill was working on a number of high-profile jobs in Scotland, including at the University of St Andrews. In June, it was appointed to refurbish a Category B-listed building at the university.

It also recently renewed a contract with Dundee City Council to install wireless fire alarms at properties.

CN approached the University of St Andrews and Dundee City Council for comment on the effect that McGill’s collapse would have on their projects, but had not received comment by the time of publication.

This is the second time McGill has entered administration in less than four years.

In March 2019, the firm – then operating under the name McGill & Co – went under but was bought out of administration by property tycoon Graeme Carling through his company United Capital Investments.

None of the original staff transferred to the new company, with some 370 people being left without employment.

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