Caerphilly’s Labour AM Jeff Cuthbert has sought reassurances from Connaught plc after it was announced that the firm had gone into administration, putting many jobs at risk.
The firm has two premises in Caerphilly town. The first is based at Gallagher Retail Park and houses the firm’s Academy, which trains local people in a range of skills. The second is based at Caerphilly Business Park and houses the firm’s compliance division.
Mr Cuthbert said: “I have written to Connaught plc asking for reassurances on a number of things as they have gone into administration.
“First of all, I want to make sure that there are as few redundancies as possible at the firm’s Caerphilly operations. In our fragile economic climate I do not want to see the local workforce or skills base depleted.
“Secondly, I have sought reassurances that the firm’s administration will not have an effect on
the provision of social housing in the area.
“I hope to have a clearer picture as soon as possible. In the meantime, I urge any of my constituents who have concerns about the issue to contact my office.”
Construction group Morgan Sindall has snapped up the bulk of the assets and contracts of the collapsed social housing for £28m, saving 2,500 jobs across the UK but leaving thousands more at risk.
Connaught was placed in the hands of administrators at KPMG on Tuesday along with its main division, Connaught Partnerships, after failing to secure further funding from its banks. Shares in the company, which had fallen by over 90% over the past three months, were suspended.
The social housing maintenance group has been hit as councils deferred projects to upgrade their stock of social housing ahead of government spending cuts. After a shock profit warning in June, its cashflow problems were exacerbated by nervous suppliers and by subcontractors demanding upfront payment.
Richard Heis, restructuring partner at KPMG and joint administrator, said: “We are continuing to seek to novate the remaining contracts to other providers and remain hopeful that more staff will transfer as part of this process.”
The compliance division, based at Caerphilly Business Park, continues to trade as normal and is not in administration.
Full story on Caerphilly Observer National News: Connaught contracts snapped up by Morgan Sindall construction group