Directors for a collapsed civils contractor are nonetheless attempting to recoup greater than £500,000 of retentions – two years after the agency collapsed.
Since O’Keefe Building collapsed in 2022, directors from RSM Restructuring Advisory have recouped simply over £24,000 of retentions. They’re nonetheless working to recoup £502,400 of excellent retentions, based on the most recent progress report printed this week.
They’ve now utilized for an additional year-long extension to the administration course of.
The Sevenoaks-based contractor went beneath after it defaulted on a company voluntary agreement it had agreed with RSM.
In its newest progress report, RSM mentioned O’Keefe was owed greater than £927,000 in retentions when it collapsed however £527,000 was “probably recoverable”. RSM has since approached the contractors that owe retention money to O’Keefe.
“Nevertheless, they’ve largely responded stating the prices of any remedial works outdated the quantities payable and due to this fact no monies are owed,” they mentioned.
The report added: “The joint directors are presently contemplating whether or not it’s doubtless that any additional funds will likely be obtained from retentions debtors.” They added that they anticipate to decide within the coming weeks.
A court docket order has prolonged the administration course of from 9 July 2024 to 13 July 2025. An additional recouping of retentions would permit RSM to make a component distribution to unsecured collectors and pay out what’s owed to HMRC, O’Keefe’s solely secondary preferential creditor.
RSM expects that the administration course of will likely be full by the brand new deadline.
O’Keefe owed greater than 400 collectors round £13.2m when it collapsed. O’Keefe was then purchased out by concrete-frame specialist Byrne Group for about £10m.
Some 150 workers joined Byrne Group from the collapsed contractor.
Retentions stay a controversial subject within the development sector, particularly over the impression they’ve on tier two and three contractors. Usually, retentions are value as much as 5 per cent of a contract worth and will take years to be paid.
Main figures within the development sector at the moment are calling for pressing motion in opposition to retentions, which they blame for squeezed margins at tier two and three ranges. In June, Mace chief govt Mark Reynolds mentioned government intervention was needed to get rid of retentions for good, as there was not sufficient assist for the measure in business.
Final yr a survey by Construction News discovered that 82 per cent of subcontractors had retentions on greater than half of their tasks, whereas 65 per cent had retentions on greater than three-quarters of their jobs.
CN has approached Byrne Group for remark.
