Garenne Construction Group ceases trading

Liquidators were appointed on Friday after the Camerons’ failure triggered cross-guarantee claims across the group. The extent of these claims rendered Garenne insolvent, the liquidators said.

The group’s directors and shareholders voted to place the company into voluntary winding up and appoint liquidators to realise the group’s assets, including shares in its subsidiaries.

‘Following the closure of Camerons, the insolvency of GCGL has been precipitated due to the various guaranteees it provided which have been called upon,’ said Guernsey-based joint liquidator Linda Johnson, a partner at KPMG.

Creditors of Camerons were invited to a meeting in Jersey last week where the Jersey business went into liquidation and the complex financial position was outlined.

It revealed that there was just some £163,000 available to pay secured creditors and nothing for unsecured creditors. The company had £7.635m. of liabilities and £5.67m. of assets, of which it was claimed that just £61,000 was available to the liquidators.

‘Non-realisable’ assets included a £2.25m. loan from the contractor to Garenne.

Alongside Mrs Johnson the liquidators are Leonard Gerber from KPMG and Geoff Jacobs and David Standish from Interpath Advisory. Mr Gerber and Mr Standish are also liquidators for Camerons.

Mr Jacobs, managing director at Interpath, hinted at a further sell-off of group companies, a process initiated last summer.

‘Our intention is to retain six employees for a period of time to continue the provision of certain head office functions [which include IT, HR and finance services] to the wider group entities where appropriate to do so, and we will also seek to realise the shares in certain subsidiaries,’ he said.

‘We thank the employees in advance for their support during this challenging time.’

Garenne Group was established in 1985 and expanded into Jersey and the UK in the 2000s. At one point it employed nearly 1,000 people and group companies had a combined annual turnover of £150m.

Last summer it was encouraging management buy-outs of some of its group companies and business including RG Falla and Geomarine left the group.

But businesses including AFM, Granite Le Pelley and Rabeys Commercial Vehicles still remain part of the group.

AFM issued a statement on social media at the weekend saying that it was not subject to any insolvency process and the business was continuing to trade in both islands.