Tag Archives: Dunbeg

Board change at troubled Ennstone Group

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Ennstone Group have announced that Mark Elliott has resigned as a Director on the Board of the Company with immediate effect but will continue in his role as President of the Company’s US subsidiary, Ennstone, Inc.

This news should be read alongside the series of articles For Argyll has published on the continuing troubles of the Ennstone Group. Entering ‘Ennstone’ in the Search on this page will bring access to previous news items.

Argyll has a particular interest in the struggles of the Group as its Scottish subsidiary, Ennstone Thistle operates four Argyll quarries – at Furnace, Dunbeg, Benderloch and Bonawe.

The news gets grimmer for Argyll’s four Ennstone quarries

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The Ennstone Group has just (28th January) announced that it has today asked for a suspension of the trading of its shares on the London stock exchange – with immediate effect.

In the USA, Ennstone Group’s cash position is still critical. Its US subsidiary, Ennstone Inc., has now suspended payments of interest charges and finance lease repayments to its US lenders. The Group says that discussions with these lenders are continuing and proposals have been made which may result in a solvent solution in that country. This though depends on the response of the US lenders who are still considering the proposals put to them. Should they either reject the proposals or fail to come to a decision by the end of January 2009, Ennstone, Inc.’s liquidity position will become critical.

On 19th December 2008, Ennstone Group announced that it was continuing to negotiate on proposals which it had received for the sale of the Group as a whole – or for a substantial cluster of its UK businesses. These proposals involved a significant equity investment and a refinancing of the Group.

However, the group says that recent developments indicate that there is now a diminished likelihood of it successfully concluding a solvent proposal for Ennstone plc and for the Group as a whole.

It emphasises that it is continuing to manage its cash position rigorously and has made a number of disposals, all reported by For Argyll,  of non-core assets which have provided additional short-term working capital in both the UK and US.

Ennstone reports that its UK lenders remain supportive of the UK businesses and that discussions are continuing to seek a solvent solution for Ennstone’s UK and Polish subsidiaries. This is expected to be announced in the near future and this is the announcement that will impact upon the position of the Argyll quarries.

The Ennstone Group Board believes that it has sufficient liquidity to the end of March 2009 provided that its UK lenders maintain and develop their current facilities. This would also depend upon the continuing support of the Group’s lease finance providers and other stakeholders.

The Group’s UK businesses, Ennstone Johnston and Ennstone Thistle – operator of Argyll’s four quarries at Furnace, Dunbeg, Benderloch and Bonawe – and its Polish subsidiary Ennstone Sp. z o.o., have continued to perform satisfactorily in the current economic downturn.

The Board anticipates that they would be in a position to continue to continue to trade satisfactorily following any required restructuring of the Group.

The Group’s decision to ask for the suspension of its shares from London Stock Exchange trading is a result of the need for space for clarification of any potential transaction and of the Company’s financial position.

The group will make a further announcement in due course but the nail biting at the Argyll quarries continues.

Ennstone disposals continue

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The Ennstone Group is continuing its asset disposals. It has announced that its wholly owned subsidiary, Ennstone Inc., has agreed the sale of its wharf facility in Pittsburgh, Pennsylvania to West Penn Aggregates Inc. West Penn Aggregates will pay, on completion, $1.73 million cash.  Completion of the transaction is conditional on Ennstone Inc.’s lenders releasing their security interest over the wharf facility.

Ennstone anticipates that the sale will be completed by 26th January 2009. The Group will then be required to repay approximately $0.21 million of outstanding finance leases of parts of the property concerned. On 31st December 2008, the property had a net book value of $1.95 million and had generated a loss of $0.66 million in the financial year which ended on that date.

Ennstone Inc. is currently negotiating with its US lenders on how the proceeds of the sale – which will be retained in the US – will be applied.

Ennstone Group is continuing to seek and negotiate on either a refinancing or an offer for the Company. However, it concedes that its financing situation remains critical and there can be no certainty of a satisfactory outcome.

This means that the four Argyll quarries – at Furnace, Dunbeg, Benderloch and Bonawe, operated by the Group’s Scottish subsidiary, Ennstone Thistle, will have to continue to hold their breath.

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.

Dunbeg Community Council to meet again on October 13th on Science Park issue

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Residents of Dunbeg village outside Oban are protesting about the Highlands and Islands Enrterprise (HIE) plan to establish a Business Park in the area beside Argyll College and the Scottish Association for Marine Science. Some might accept the Park but feel strongly that it is being sited in the wrong place – on the shore, backing onto a pretty beach the villagers regularly use. Some have put together an argument thay there is no evidence of demand for the proposed Park.

Argyll and Bute Councillors for the area were present. Councillor MacIntyre put the wider issues to the meeting, noting that the economic impact of the proposal on the north Argyll area should not be overlooked. He specified 270 high quality jobs with an investment of £10 million. Concillor McCuish offered a stout hostage to fortune in suggesting that if the project were to be offered to Campbeltown, ‘they would bite our hands off for it’. With the Campbeltown area currently facing the loss of 92 jobs in the planned closure of the Vestas wind turbine plant, his remark begs the question of why the Science Park is not indeed going to Campbeltown. Councillor McKay played the ‘soft cop’ role and reassured those present that they would have a chance to object again in the detailed planning application process.

The Community Council agreed to meet again on 13th October.