ONE PART of the failed Lilley construction group -- employing 730 of
the 2800-strong workforce -- is already on the point of being saved.
Negotiations are at an advanced stage for a management buy-out at
Robison & Davidson, the construction and housebuilding group based in
Dumfries.
A spokesman for Mr Bob Robison, the company's managing director,
confirmed to The Herald last night that talks on the buy-out had been
well under way before the receivers were called in at the request of
Lilley's board on Thursday. Meetings were continuing yesterday.
The Dumfries-based company, which first joined the Glasgow-based
Lilley group in 1979, was not included in the various divisions and
subsidiaries put into the receivers' hands. That implies the buy-out
negotiations are likely to succeed.
Robison & Davidson is widely regarded as one of the soundest parts of
Lilley. In 1990, it made pre-tax profits of #3.12m on turnover of
#28.07m. Net assets were #6.57m and borrowings a modest #478,000.
Meanwhile, the receivers from Price Waterhouse are so confident of
finding buyers for the 30 companies involved that a closing date for
bids has already been set.
Less than 24 hours after being appointed, the insolvency experts
confirmed offers must be in by noon next Friday -- with new owners
likely to be known by the close of business on Monday, January 18.
Joint receiver Iain Bennet justified such a swift timetable on several
grounds.
He argued the deadline is important to preserve the current value of
businesses -- partly based upon contracts in hand, worth about #100m
according to some reports.
Mr Bennet also said the receivers had to show Lilley customers that
there is a clear strategy for moving forward while, at the same time,
demonstrating works will resume.
He was adamant the strategy offers the best prospects for preserving
jobs in the group, which employs 1800 in Scotland and has net
liabilities of #13m.
Mr Bennet confirmed there will be job losses of ''more than 100'' but
is hopeful the final total could fall below 250.
However, a shareholder yesterday began moves to mount a rescue
operation for the group, insisting it is not too late to resurrect
survival plans which the group's banking consortium abandoned.
The banks' role in the collapse remains a sore point with investors
and politicians alike.
However, Clydesdale bank chairman Sir David Nickson continued to fend
off criticism of the bank's role in Lilley's receivership.
Sir David told The Herald he had been kept fully informed of the
decision not to back a proposed rescue package.
The package had the support of Lilley's three main institutional
shareholders and some of the other funding banks, including the lead
bank, Bank of Scotland.
But unanimity among the banks was necessary and, when the Clydesdale
refused to give its support, and two others refused to subscribe any
additional funding, receivership became inevitable.
That led Mr Graeme Knox of the biggest shareholders, Scottish
Amicable, to accuse the Clydesdale of putting a major Scottish company
out of business.
Sir David said yesterday that both the Clydesdale board and the bank
were very comfortable with the decision they had taken. He did not
expect the outcome to do the bank any lasting damage.
Liberal Democrat trade and industry spokesman Malcolm Bruce, calling
on the banks to reconsider, said: ''It is both tragic and ridiculous
that Scotland's largest construction company should have been destroyed
for want of #2m.''
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article