Former ISG employees told to expect some money back

Administrators for ISG have said the amount of money recovered for creditors has topped £26m – although unsecured creditors owed £885m have again been told they are unlikely to receive a payment.

In a progress report, EY said £7.1m had been recovered in the six months to the middle of September. It said the bulk of this, £5.2m, had come from the firm’s engineering business.

The report said a dividend distribution to primary preferential creditors – classed as former employees – is planned.

It said four of the eight companies which sank into administration last September had primary preferential creditors who can claim up to £800 in missing wages and holiday pay. But it added: “[The payment] is unlikely to occur for at least six months as we await the issuance of all protective award claims.”

The report said HMRC is owed £91m with some of the money it is owed set to be repaid eventually. “However, the joint administrators anticipate that these amounts will not be fully repaid, resulting in a shortfall to HMRC against its total debt. It is not currently possible for the joint administrators to estimate the quantum of any dividend which may be payable to HMRC.”

And it said “we do not anticipate” a dividend to be paid to unsecured creditors, collectively owed £885m.

EY’s report said it was working with law firm Pinsent Masons to recover money through claims, adding: “We continue to retain two former employees of [ISG} on a consultancy basis to advise, collate documentation, as well as provide supporting technical and commercial information as required.”