Unsecured trade creditors of the failed Lagan Construction Group, many of them small firms, are owed more than £9 million according to administrators appointed to the Belfast-headquartered firm.
Administrators at KPMG estimate that Lagan Construction Group Limited has total debts in the region of £44.8 million.
Danske Bank, a secured creditor, has one of the biggest exposures to the failed group. It is owed more than £3.9 million and another £24 million in relation to an “intercompany guarantee provided to other Lagan Group companies” for which the failed Lagan Construction Group Limited is “jointly and severally liable”.
Preferential creditors are owed more than £111,000, the administrators conclude, while other unsecured creditors, including joint ventures, are owed more than £12 million.
In their latest progress report, administrators revealed that Lagan Construction Group Limited had “no cash at bank” when they were appointed in March.
John Hansen and Stuart Irwin from KPMG were appointed administrators to Lagan Construction Group Holdings Limited, Lagan Construction Group Limited, Lagan Water Limited and Lagan Building Contractors Limited.
Continue to trade
The Lagan Construction Group has 26 other companies which all continue to trade.
According to Mr Hansen and Mr Irwin, the directors of Lagan Construction Group Limited have provided them with a statement of affairs which details that the company had work in progress valued at more than £8.4 million, contract ledger debtors amounting to more than £1.1 million and retentions totalling more than £2.2 million.
In addition to this, it also had other debtors totalling more than £2.6 million, amounts owed by joint ventures amounting to more than £1.8 million, intercompany debtors that totalled more than £2.3 million and a VAT debt of more than £1.6 million.
The administrators said they have determined that an “asset realisation strategy” is the only feasible option for Lagan Construction Group Limited “with particular focus on investments in subsidies, work in progress, debtors and retentions”.