黑洞社区 investigation reveals that fit-out group went into receivership last month owing subcontractors 拢3m

Fit-out group Curzon went into receivership last month owing its bank about 拢11m, a 黑洞社区 investigation has revealed.

Curzon's bank, Lloyds TSB, pulled the plug on Curzon because of its volatile overdraft. Combined with other debts, it owes Lloyds TSB 拢11m.

It is also understood that:

  • The company got into problems because of money lost on contracts in Brighton and Dundee
  • A rescue package collapsed the day before it went into receivership, because a bondsman in the Isle of Man decided against guaranteeing the company 拢2m
  • Former Curzon employees estimate that the company's subcontractors are owed 拢3m for work they did before receiver Ernst & Young was called in on 7 March.
The day before Curzon went into receivership, the company's directors were putting the finishing touches to a plan to save the company, which included some of their own money and a venture capitalist.

However, the bondsman reneged on an agreement to put up 拢2m to guarantee its overdraft facilities, leading to the collapse of the proposed deal.

David Freeborn, Curzon's then-chief executive, said: "Any deal isn't done until the ink is on the paper. We thought that we had a deal, but it didn't get signed."

The company's problems revolved around contracts on the conversion of a jute mill in Dundee and the redevelopment of a technical school in Brighton into a block of flats.

Both schemes were completed before Curzon collapsed, but the company was cash-strapped. It had attempted to recover 拢2m from the Dundee contract and at least double that in Brighton, having argued that there were a large number of design variations on both schemes.

The company only recovered 拢250,000, and its lack of working capital meant that it had little room for manoeuvre when its largest framework contract, British Telecom's 21st-Century Network upgrade programme, was delayed.

It is not entirely clear how much subcontractors are owed, but a conservative estimate is 拢3m for the work they had already done. This does not include loss of earnings for work promised to them.

The managing director of one subcontractor, building services company Piggott & Whitmore, said he was angry that Curzon had not disclosed how bad its finances were prior to going into receivership. Alex Kirkwood said: "We have survived it, but no thanks to them."

n Surrey-based interiors business Cube has hired David Kingsbury former Curzon Interiors operations director. Kingsbury has been taken on as contracts director for the business, set up less than a year ago. It is expected to post a 拢4.5m turnover in its first financial year.

Cube is the sister company of fit-out design and build specialist Area Sq, which is expected to make 拢16m this year, up from 拢12m in 2004/05. The group should make a combined pre-tax profit of 拢550,000.