Watchdog may pursue former parent company Durkan for £3.3m fine after contractor fails
The Office of Fair Trading’s bid-rigging investigation has claimed its highest profile casualty with the collapse of £43m-turnover contractor Concentra.
Concentra, formerly known as Durkan Pudelek, received a £3.28m fine in September. One allegation was that it accepted a £60,000 compensation payment from rival Mansell on an office refurbishment for a firm owned by Sir Alan Sugar in 2003.
The business, which is based in the South east, was put into administration on new year’s eve and half of its 40 staff were made redundant on 4 January. Work on all its sites has been suspended pending the outcome of the administration.
Three separate sources close to the process said the reason for the administration was the OFT fine.
Cameron Gunn, an administrator for Resolve Partners, said he was looking into the reasons for the insolvency. He said: “We’re continuing to trade and are marketing the business as a going concern. We’re confident a sale will be achieved in less than a week’s time.”
Durkan held a 51% stake in Durkan Pudelek until 2007, when it was bought by Gombe Holdings and renamed Concentra.
The OFT held Durkan and Concentra jointly and severally responsible for the fine, but now that Concentra has been put into administration, the watchdog may pursue Durkan for the cash as well as a seperate £3.4m fine imposed on it for alleged cover pricing. If so, it will mean that the £165m turnover firm is facing a total bill of £6.7m.
Durkan has lodged appeals against the fine claiming it had no effective control of Durkan Pudelek when the offence is alleged to have occurred, and that nobody at Durkan engaged in cover pricing.
Brian Berry, director of external affairs at the Federation of Master Builders, said: “This is what we feared would happen and why we campaigned for the OFT to be lenient. The fines have come at the worst possible time, and who’s to say that Concentra will be the last.”
A spokesperson for Durkan said: “It is premature to speculate on what may happen while the appeal is still in progress.”
An OFT spokesperson said the levels of fine were proportionate to the infringements committed and that the OFT had taken account of firms’ finances.