More than 250 jobs go with collapse of Owen Pugh - but picture is brighter for Marsden Quarry workers

Owen Pugh's Marsden Quarry site
Owen Pugh's Marsden Quarry site

More than 250 people are to lose their jobs with the collapse of North East engineering firm Owen Pugh.

But the future looks brighter for 30 people employed at the firm's Marsden Quarry site.

Christopher Petts and David Dunckley of Grant Thornton UK LLP were appointed as a Joint Administrators of the Newcastle-based group yesterday and have been carrying out detailed discussions with key stakeholders, including customers, senior employees, professional advisors and interested parties.

Christopher Petts said: "The Joint Administrators can confirm that Owen Pugh Aggregates, which operates Marsden Quarry near Sunderland, continues to be maintained whilst a buyer is sought.

"All 30 employees at the Owen Pugh Aggregates site have been retained and are working with the Joint Administrators to help effect a going concern sale. To date, we have received a significant amount of interest from potential purchasers.

"Unfortunately, and despite our best efforts, the position regarding the other businesses making up the group is less positive. Upon our appointment it quickly become clear that the civil engineering contracting arm of the business was not viable and further trading could not be supported.

"Furthermore, key customers highlighted that the insolvency of the group had triggered contract termination clauses.

"In turn, due to the inter-dependency within the group on these large civil engineering contracts, there was a knock on effect on the viability of the plant hire and drain services businesses.

"Therefore, after much consideration, and taking into account the absence of funding available to the Joint Administrators, the reluctant decision has been taken to cease to trade Owen Pugh & Company, Owen Pugh Civil Engineering, Owen Pugh Contracts, and HCS Drain Services, with 257 employees being made redundant.

"The Joint Administrators and our colleagues will continue to work with those employees affected to assist them through this difficult time and to help them find new employment," he added.

A further nine employees have been retained at the Group’s head office in the short term to assist the Joint Administrators.