A metalwork firm, Fablink Group, which employed hundreds of people across the North East, Midlands and South East, has collapsed just months after being rescued in a pre-pack administration deal.
In September, the company was bought for nearly £3m by investors Praetura Commercial Finance and TDC Impact Limited, supporting director Richard Westley in a new venture named Wharfside Industrials. At the time, administrators hoped that a series of pre-pack deals involving eight group subsidiaries would secure the future of the business, specialising in metal pressings, cab assemblies and fuel tanks, with operations in County Durham, Wolverhampton, Luton and Northamptonshire.
But in the following months, the business lost contracts with several key customers and now EY administrators have been appointed. The majority of the group’s 427 staff, including around 200 in County Durham, have been made redundant while joint administrators Lucy Winterborne and Dan Hurd explore a sale of certain parts of the group and its assets.
The group’s collapse in September followed a challenging few years for Fablink, during which a £5m Government grant for the relocation of its Wolverhampton site reportedly failed to materialise. The company also suffered a £1.5m bad debt following the insolvency of an electric vehicles customer in 2023.
The firm faced headwinds as it contended with quality issues in cabs made for an important client, leading to increased manufacturing costs and missed sales opportunities. The company also struggled under the weight of expensive commitments related to an electric vehicles contract that failed to meet expected volumes, reports Business Live.
Early in the previous year, HSBC, the principal lender, roped in insolvency experts Interpath to pore over the company’s immediate financial situation. By March, efforts were afoot to secure a buyer or evaluate restructuring avenues.
Facing intense creditor demands, a solitary bid was received from Praetura Commercial Finance and TDC Impact. The deal, priced at £2.95 million, was still subject to outstanding payments of approximately £1 million, scheduled to be settled in instalments until September 2025. Records indicated that by September, when the enterprise fell into administration, it owed over £2 million to trade creditors and reported a staggering deficit of £14.4 million.
A release from EY administrators elucidated: “The group was acquired out of administration in September 2024, but since then it has unfortunately lost the business of certain key customers. The group’s management team has worked tirelessly to find a viable solution to rescue the business, however, the significant loss of business has severely impacted the group’s future viability. As a result, the directors have determined that they have no option other than to place the group into administration.”
“Regrettably, given the lack of ongoing business, the majority of employees have been made redundant whilst the joint administrators continue to explore a sale of certain parts of the group and its assets. All employees impacted are being offered appropriate support and advice.”