Specialist contractor can continue to trade after creditors vote
Specialist contractor MPG has been given a reprieve from insolvency after its creditors voted to accept a proposed company voluntary arrangement (CVA).
that the 拢46.3m-turnover firm had filed for a CVA. At the time the company blamed the move primarily on an unresolved 拢2m payment dispute with main contractor Galliford Try resulting from delays on construction of the final phase of the London 2012 athletes鈥� village, on which they both worked.
A well-placed source told 黑洞社区 over 90% of MPG鈥檚 creditors voted to accept a CVA at a meeting held yesterday.
Formal confirmation of the CVA will be sent out to creditors by accountant MHA MacIntyre Hudson in the coming days.
A CVA 鈥� a legal agreement with a company鈥檚 creditors on a schedule to repay debts 鈥� will buy MPG time to generate the cash to pay its creditors, who will be paid in dividends once sufficient funds are brought in.
MPG owes 拢10.2m to various parties, including 拢2.3m to trade creditors and 拢1.4m in retentions, according to a proposals report drawn up by MPG and MHA MacIntyre Hudson last month.
An MPG spokesperson told 黑洞社区: 鈥淲e are delighted. We have done a lot of hard work getting this CVA together and our clients and our supply chain have been amazingly supportive.鈥�
The spokesperson added that one of its clients has awarded it a new contract in the last few weeks.
Galliford Try was ordered to pay a sum - understood to be around 拢350,000 - to MPG by an adjudicator last month, but MPG said it received correspondence from Galliford Try a week later saying it 鈥渞efused to pay this鈥�. Galliford Try has previously declined to comment on this allegation.
The MPG spokesperson said the firm has now issued a claim to the Technology and Construction Court to enforce the adjudication award decision.
Subject to the outcome of this enforcement decision, the spokesperson said MPG will 鈥渞eview our options鈥� in terms of potential further proceedings to recoup the full 拢2m it estimates it is owed.
Yesterday鈥檚 creditors meeting was rearranged from 4 December.
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