Wed, 12 Oct 2016 | ADMINISTRATION
One of Coventry’s largest employers has gone into administration. CovPress Limited has called in administrators, leaving the jobs of 800 staff uncertain.
According to recent accounts for the company, profits had halved from £4.1 million to £2.2 million due to aggressive expansion plans. In addition, interest payments on borrowed money had ballooned to £1.5 million.
The precision metal pressings company manufactures parts for automotive companies such as Jaguar Land Rover. Turnover for the period of 2014/15 was £89 million. The reason for going into administration has been blamed on cash flow issues, with administrators from Grant Thornton being appointed to deal with the process.
Since being taken over in July 2013 for £30 million by a British-Chinese consortium, additional funds to the sum of £25 million was invested in both machinery and staff. The company also bought out UYT, a Honda parts supplier, for £30 million and renamed to CovPress Assembly. This company is unaffected by the administration.
In a statement to BBC Coventry and Warwickshire, joint-administrator Eddie Williams, of Grant Thornton, said: “We have tried to get the message out to workers as quickly as possible and we have been having face-to-face meetings.
“The majority have now had face-to-face meetings with administrators.”
He also said that he was optimistic at securing a buyer to facilitate a takeover of the company but added that the company had “significant and urgent funding issues”.
Speaking about the administration, Coventry city councillor Bally Singh said that the CovPress company was “ideally placed to serve the growing motor industry in the Coventry and Midlands supply chain”. He also urged the sale to happen quickly stating that “Coventry should not have to witness another wave of job losses in the manufacturing sector especially when the companies themselves are fundamentally sound”.
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