Published: 25th October 2016
A supplier of steel fabrication services based in Teesside in the North East of England has been entered into administration after being beset by financial difficulties over the course of the past 12 months.
Joint administrators have been appointed at SBV Engineering, which suffered a huge blow late last year when one of its most important customers, SSI UK, was entered into liquidation.
SSI UK was a major employer in the region and its collapse resulted in substantial losses for SBV, which has been struggling to balance its books and stay in business ever since.
Administrators have explained that SBV Engineering was only able to survive the collapse of SSI UK by revising arrangements with its key creditors and by securing fresh financial support.
However, in recent weeks, its financial situation has worsened and become unsustainable, with the business becoming unable to service its liabilities and administrators having to be called in.
All 38 members of the Middlesbrough-based company’s workforce we made redundant immediately upon the appointment of the administrators.
“SBV Engineering has struggled to recover from the loss of a major trading partner and the wider, well-documented challenges facing the UK steel industry,” Howard Smith, one of the administrators from KPMG, said in a statement.
“We will now work to wind down the business, provide support for the employees and explore options to realise assets.”
SBV Engineering was created in December 2014 as a result of an earlier administration involving its predecessor SBV Fabrication and Site Services Ltd.
The UK’s steel industry has been undergoing a particularly challenging period of late, with a number of large-scale operators and smaller businesses in the field having collapsed into administration and liquidation during 2015 and 2016.
SSI UK owned the Redcar steelworks when it entered liquidation in October 2015. The company’s collapse caused around 2,000 people in the North East of England to lose their jobs.
Meanwhile, Tata Steel has shed more than 1,000 jobs from across its UK operations during 2016, with British steel producers struggling to stay in business in the wake of a sharp drop in the wholesale price of steel on global markets. With 78 offices stretching from Inverness down to Exeter, Real Business Rescue can offer unparalleled director advice across the UK.