John Clemow: YRM’s former chief executive is one of only five staff offered jobs at the firm’s new owner
Clemow concerned about firm’s “credentials” with clients if management bought business
The former chief executive of YRM ruled out a management buyout of the practice because he was worried clients such as EDF would stop working with it.
John Clemow was just one of five employees who transferred across to RMJM after it bought part of the stricken business out of administration two days before Christmas. The remaining 20 staff, who were owed two months’ wages, all lost their jobs.
RMJM’s purchase included YRM’s nuclear jobs, among them work it was carrying out for EDF Energy on a planned new nuclear power station in Somerset called Hinkley Point C.
A letter sent to creditors last week by administrator Richard Toone from accountant Chantrey Vellacott DFK, described the French utility firm as YRM’s “principal customer” adding that YRM’s relationship with EDF “was critical to the survival of the business”.
Toone added: “Whilst Mr Clemow had stated that he was interested in seeing the business move forward, he did not believe a management-led purchase would result in an entity that would have the capacity, capability or credentials to satisfy the requirements of EDF and other clients for major infrastructure projects.”
The letter said Clemow did not have the cash to make an offer for the business and added that he ditched the idea of a Company Voluntary Arrangement – which protects the business from winding-up petitions from creditors – because it “was not a viable option for the business due to the injection of capital required to cover the short term working capital requirements (especially the employee salaries that would become due for payment by the end of November)”.
The administrator also revealed that a unnamed buyer had been lined up to take over YRM by the end of November but that this fell through at the eleventh hour after due diligence highlighted concerns with “the timing of cash inflows”.
Toone confirmed that RMJM, which held meetings with EDF prior to making its offer, paid £30,000 for the business which could rise by a further £75,000 under the terms of the deal.
24 January 2012
24 January 2012
17 January 2012
16 January 2012