Cost of Simclar Group collapse hits £1m

THE costs of handling the administration of one of Scotland’s biggest technology collapses has topped £1 million.

The latest update on the handling of the affairs of the former Simclar Group reveals that just over 3,000 hours – at chargeable rates of more than £330 an hour – have so far been spent by Deloitte on work to recover cash for creditors.

Dunfermline-based Simclar, which supplied cables and components to electronics companies and employed more than 1,000 at its peak, collapsed in 2011 owing the Bank of Scotland £28m.

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Unsecured creditors have already been warned that after costs and repayments to the bank there will be no funds available for them.

So far £2.2m has been realised from the assets of the Simclar group companies including £134,000 from the sale of the remnants of the UK manufacturing operation. Seven factory units which the group owned at Pitreavie Business Park in Dunfermline are up for sale and the administrators are working with property agents to assess interest from potential purchasers and tenants.

A £4.4m claim has also been lodged against another company connected to the group which went into liquidation.

Simclar, founded by Sam Russell, grew from humble beginnings to become the parent company of a subcontract manufacturing group with operations in the UK, China, Mexico and the US.

Despite closing two plants in Ayrshire with the loss of 420 jobs in 2007, the UK operation still employed 217 people when it failed. It supplied a number of blue-chip customers, including Bombardier and Alexander Dennis.

More than 100 former workers of the group were last year awarded compensation totalling £1.15m.

Industrial trade union Community secured the compensation award following an employment tribunal in Glasgow.