Social housing contractor fails to find funding to secure survival

Social housing contractor Connaught has been placed into administration.

In a statement to the Stock Exchange late yesterday afternoon, the company said: “Since the end of July, Connaught has held discussions with its lenders and alternative providers of finance with the objective of securing additional funding and a restructuring of the company’s financing for the longer term. During this period, the board of the company has also continued to explore its options to improve the financial position of the Connaught group of companies (the “Group”) and to realise value for the benefit of all stakeholders.

These initiatives failed to reach a satisfactory conclusion in the time available and, following extensive discussions with the Group’s secured lenders, it is now clear that sufficient support would not be extended to the Group as a whole to enable it to continue trading as a going concern. As a consequence, the board is saddened to announce that it is in the process of appointing partners from KPMG as administrators of Connaught plc and its subsidiary, Connaught Partnerships Limited, which comprises its Social Housing Division.”

The administration does not include its compliance and environmental arms of the business, which the company is trying to sell.