Tolent Construction Limited et al.

The Joint Administrators of a giant Gateshead-based contractor have made significant headway in advancing the administration, but have received little interest in purchasing the business.

Tolent Construction Limited and various connected entities entered administration on 13 February, after heavy losses were incurred from the company's biggest project to date, the £85.5m Milburngate development in Durham. James Lumb and Howard Smith of Interpath Advisory were appointed Joint Administrators.

The Joint Administrators' initial strategy was to explore a sale of both the construction business and the industrials business.

The construction business included 16 live contracts, including Milburngate. The Joint Administrators explored a potential sale of the company's interests in these contracts, but potential purchasers did not attribute value to the interest in the contracts that may be loss-making and could be terminated by the contract employers.

Northumberland County Council has reportedly appointed Premier Plant & Civil Engineering to finish work on the new Berwick Sports & Leisure Centre, which was previously being overseen by the company.

The Joint Administrators marketed the Teesside-based industrials business for sale. Five parties signed NDAs and were provided information on the business and assets. Following a period of negotiation, interested parties concluded that there was no value in the contracts which were terminated or terminable on insolvency. In addition, the industrials business had ceased trading and, following the redundancy of the employees, there was no guarantee of a readily available workforce. As such, no offers were received for the industrials business as a going concern.

However, an offer was received from Brims Construction (which is run by three former Tolent staff – two of whom are the sons of Tolent's founder) to purchase Cleveland House and the furniture and equipment held within. A sale was completed on 24 February.

The Joint Administrators' Proposals can be found HERE. They have been assisted by Shoosmiths and Hay & Kilner, as well as agents Avison Young and Gateley Vinden.