Tag Archives: Bonawe

Another fire sale property disposal for short-of-working-capital Ennstone, operator of four Argyll quarries,

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The troubled Ennstone Group (operators of quarries at Furnace, Dunbeg, Benderloch and Bonawe in Argyll) announced today that it has now sold another property asset to meet its needs for short term working capital.

The property is the Group’s former natural stone works and redundant quarry at Stainton in County Durham. It has been sold to three local businessmen for £1.325million cash. Less than two weeks ago, on 31st December 2008, the property had a net book value of £2.234million. Ennstone expect the sale to complete on 14th January. Ennstone are to retain the proceeds of the sale to meet short term working capital needs.

The Group says that it is still pursuing negotiations either on refinancing or on an offer for the Company and admit that the company’s financing situation remains critical.

Its statement says baldly that: ‘…there can be no certainty of a satisfactory outcome’.

Troubled Ennstone announce appointment of new Executive Chairman

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The Board of the troubled Ennstone Group, operator of four Argyll quarries – at Furnace, Dunbeg, Benderloch and Bonawe – have this morning (5th January 2009) announced that Julian Cooper has joined the Board with immediate effect as Executive Chairman.

Mr Cooper is a Chartered Accountant and brings to the Board his considerable experience in a variety of executive management positions.  He is a senior partner of consultants, MPC Partners LLP and is a former partner at Arthur Andersen. This was once one of the Big Five international accountancy firms until its collapse in 2002, mired in the Enron financial scandal in the USA.

Julian Cooper succeeds Graham Brown who will remain on the Board as a non-executive Director, ensuring a smooth transition. The Board of Enstone Group wish to thank Mr Brown for his service to the Group as Interim Executive Chairman.

The coming days and weeks will be critical to Ennstone in its admitted difficulties, as For Argyll has reported, so Mr Cooper joins at a time when all of his skills and experience will be immediately needed. It is in Argyll’s interests that he succeeds.

Argyll concerns deepen as troubled Ennstone sees director resign from Board

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Ennstone today (29th December) announced, without explanation, the resignation of non-executive director, Tim Ross from the Board of Ennstone Group, to take effect from 31st December 2008.

For Argyll has regularly covered recent developments in Ennstone’s situation which are of concern in Argyll. The Groups Scottish wing, Ennstone Thistle, operates four Argyll quarries – in Furnace, Dunbeg, Benderloch and Bonawe.

The Group recently sold off a major asset – its Concrete Products business – without making any significant improvement to its trading position and admits that January 2009 will be a testing time.

Ennstone problems deepen, with four Argyll quarries: Furnace, Dunbeg, Benderloch and Bonawe, under threat

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Ennstone Thistle, the Scottish wing of the troubled Ennstone Group, operates four quarries in Argyll – at Furnace, Dunbeg, Benderloch and Bonawe.

Yesterday (22nd December) Ennstone announced that it has sold ‘the trade and assets of Ennstone Concrete Products Limited’ (aka Concrete Products) to FP McCann Ltd. This is its precast concrete products business, and after its disposal, Ennstone will no longer have any involvement in the ongoing manufacture of concrete products.

As part of the disposal agreement, Ennstone has agreed a long-term supply of aggregates from certain of its quarries to the sites now disposed of and to a further FP McCann site. This agreement secures this particular market for aggregates from specific quarries.

However, when some debts were discharged within the sale agreement, only £3.3 million of the £8.4 million cash and debt free deal for Conrete Products remained to the Ennstone Group. These proceeds were required by its Board, in the absence of any additional credit, to provide short-term cash to meet the Group’s working capital needs.

Without the proceeds of this sale, Ennstone admits that:  ‘the Board is of the opinion that the Group would not have had sufficient liquidity to meet its financial commitments as they fell due.’  It says that in such circumstances: ‘the Board would have had to appoint administrators, liquidators or receivers’.

This is no more than a temporary respite. Regardless of the modest proceeds from this asset sale, the Group’s Board confirmed that, if no offer for the Group is made, the Group will require substantial additional funding. It will also need to reach an agreement with its debt providers on the restructuring of its existing facilities during January 2009.

Should these arrangements noit materialise, Ennstone is saying that: ‘it will not have sufficient liquidity to trade as a going concern and the Board will be forced to seek the appointment of receivers, administrators or liquidators’.

Given that the Group  – and those who, in different conditions, might have made an offer for it – are likewise finding finance hard to come by, the reality is that the company is looking at the likelihood of this outcome in January at the latest.

Ennstone, operator of four Argyll quarries, said to be ‘troubled’

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Shares in Ennstone, the company currently operating Argyll quarries at Furnace, Dunbeg, Benderloch and Bonawe, dropped sharply yesterday (16th December 2008) when it admitted it was in advanced talks to sell assets to meet cash obligations in the UK and the USA.

Ennstone runs a range of quarries, concrete plans and contract operations in the UK, Poland and the USA. It has said that it is now in breach of its USA banking facilities and, through a reciprocal arrangement, also in breach of its UK banking facilities.

This statement was made after the group suspended interest payments and finance lease repayments on its American banking facilities because of what is described as a ‘deteriorating cash position’.

The worldwide recession will also make asset disposals difficult as credit to fund potential buyers will be hard to find.

Ennstone says that its British and American financial sector creditors are considering whether to waive the breaches incurred. The company is looking to arrange restructuring in the USA and rescheduling specific debt repayments in the UK.

It has experienced a period of consistent expansion and acquisition. It operates in Scotland under the name Ennstone Thistle, employing over 400 people at 30 locations. It is one of the largest producers of aggregates, sand, gravel, asphalt and ready-mix concrete in the country.

Last month (November 2008) Ennstone announced that it was cutting around 1,200 jobs across the UK, saving £2 million in annual costs.