Change Recruitment had racked up losses of more than £5 million in just five years before it was sold to rival Head Group after falling into administration last week.
Administrators from FRP Advisory were appointed to the recruitment firm last Monday before it was bought by industry veteran and serial angel investor Paul Atkinson for an undisclosed sum.
• READ MORE: Recruitment guru Paul Atkinson buys Glasgow’s Change
The deal saw all staff retained at Change, headed by mananging director Mark McFall, as it becomes part of Atkinson’s Head Group, which also owns Head Resourcing, Head Medical and Atkinson MacLeod Executive Search.
McFall described Head as an “excellent cultural fit” for the business, adding that it was moving into a “new and exciting phase of growth”.
Combined turnover for the enlarged group will be in excess of £60m. It will have more than 140 staff operating from offices across Edinburgh, Glasgow and Leeds, serving clients in more than 15 countries.
In January, Change reported widening pre-tax losses for its last financial year.
Pre-tax losses rose 50 per cent to £2.15 million from £1.43m the previous year despite turnover rising 5.7 per cent to £17.97m. The downturn in the oil and gas sector was cited as one of the factors behind the increased losses.
FRP Advisory joint administrator Tom MacLennan described last week’s deal as an “excellent outcome for both companies”.
He said: “It brings together the resources and reach of two of Scotland’s leading recruitment brands. It also secures ensures continuity of service for clients and employment for staff.”
Last August, high-profile Scottish firm PRG Recruitment was sold to its management team in a pre-pack deal before administrators were appointed. It was later revealed that the business, which had ambitions to become a £50m business by 2020, was sold for £130,000.