Aberdeen subsea firm appoints administrators
Aberdeen-based subsea services company CIE Well Control has antered into administration. At the request of the company’s directors Blair Nimmo and Geoff Jacobs of KPMG LLP were appointed as Joint Administrators of CIE Well Control Limited (“CIE”) on 19 August 2016.
CIE provides a range of subsea and surface engineering services to the oil and gas industry from its base in Aberdeen, including design, precision engineering, welding and fabrication, assembly and testing.
According to the administrator’s statement this week, in 2015 CIE began to encounter a fall in client orders, as oil and gas operators began to cut costs and actively target reductions in both capital and operating expenditure. With the reduction in the volume of work available, margins were continually squeezed as competitors forced pricing downwards. This resulted in cash resources being depleted and ultimately required the directors to seek the appointment of Administrators.
At the time of appointment, CIE was working on a number of ongoing projects for clients but did not have sufficient resources to complete the contracts. Due to the limited funds available and uncertainty concerning CIE’s ability to complete the contracts, it has been necessary to implement 21 redundancies, the administrator said.
The remaining two employees of CIE have been retained to assist the Joint Administrators to realise the Company’s assets and to help market the business and assets for sale.
Blair Nimmo, Joint Administrator and UK Head of Restructuring for KPMG, said: “Our appointment today is yet another example of a business in the sector which has been negatively impacted by the low oil price and the consequent reduction in upstream activity resulting in cash flow challenges.
“We are currently working with retained staff to realise all assets, and will provide all employees affected by redundancies with appropriate guidance and support.
“We will be contacting the Company’s customers and will do everything we can to seek a buyer who may be able to protect the Company. We would encourage any party who has an interest in acquiring the company’s business and its assets to contact us as soon as possible. CIE has a strong reputation in its markets together with an asset base which will be of interest to a number of parties, principally comprising its forward order book with a blue chip client base and a variety of machinery in addition to Intellectual Property.”
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