04.05.2022

Graham Jones Cranes adminstration

UK Crane company Graham Jones Cranes - which entered administration last month - will be 'wound up' although the trading business will continue as a trading name of G Jones Holdings and Graham Jones Contract Lifting, following a pre-pack purchase.

The Wrexham based company which was set up in 1993, suffered accounting issues in 2018 to 2019 causing it to launch a restructuring programme, but as Covid lockdowns hit, revenues collapsed from £5.1 million in the year to July 2019 to £3.7 million in the 18 months to January 2021.

The administrators Kelly Burton and Robert Neil Dymond of Wilson Field were appointed just over two weeks ago after a creditor filed a winding up order for around £75,000. They have already issued a report, published at the end of April.
A secured creditor, Regency Factors will receive the £51, 000 that it is owed, while secondary preferred creditor HMRC, which is owed around £485,000 will be paid in part, while unsecured creditors which are owed £1.7 million are unlikely to receive anything. The total amounts owed come to £2,248,624.

G Jones Holdings and Graham Jones Contract Lifting have agreed to pay £175,000 for certain assets including goodwill, intellectual property, customer lists and residual stakes in financed equipment etc... It has also taken over the employee contracts saving the failed business more than £200,000 and all responsibility for financed cranes.

As to the cost of the administration Wilson Field has already run up a bill of £67,500, while valuation agency Chesterfields is looking for around £180,000 for valuations and commission on the pre-pack sales of assets and law firm Ward Hadaway will so far bill £12,750 for legal work.

Vertikal Comment

This is the second UK crane rental company to fail in the last month or so, Quinto Cranes closed its doors last month and ceased trading.
The Graham Jones Cranes insolvency is different in that the trade name will continue, covering the North Wales and the North West region, and jobs and finance company debt were saved.

Apart from the fact that the business was over indebted in the face of collapsing revenues we know little of the detail. What is clear are the excessive costs charged by those involved in the insolvency process, and how unfit for purpose the UK’s insolvency laws are. The sad thing is that most creditors who will go unpaid, are likely to face their own difficulties from the bad debt that they incur.