Wrekin firm's £25m pension claim

The pension scheme for Wrekin Construction workers is claiming nearly £25 million from the collapsed company – bringing the total amount owed to creditors to more than £40 million, administrators revealed today.

And the likely cash realised by the sale of the Gem of Tanzania, a ruby owned by the company, is likely to raise only a "fraction" of the £11 million reported worth listed in the firm's company accounts.

Ian Best, of administrator Ernst & Young, told a meeting of creditors today there were also concerns about the conduct of the company's directors in the time leading up to Wrekin's collapse and transactions between Wrekin and its associated companies.

About £2 million of Wrekin's cash was invested in other companies in the group, owned by businessman David Unwin, with three of those companies going into administration last month.

Mr Best told the meeting in Telford: "The books and records are not of the highest standard and that will be part of the considerations in our ongoing duty to report on the directors' conduct.

"Choosing my words very carefully, there are some transactions that have caused the administrators significant concerns and those transactions are being pursued.

It is pursuing the funds which were either invested or transferred to the other companies which is the main concern at the moment. And what I can tell you is two related companies are likely to go into liquidation tomorrow."

Mr Best also told the meeting, attended by about 50 representatives of more than 1,000 creditors, a claim had been submitted by the company pension scheme and pension protection fund for just under £25 million.

"That is clearly higher than the balance sheet value and that is likely to swell the total creditors to above £40 million," he said.

But creditors were told it was unlikely the sale of the ruby known as the Gem of Tanzania would reach anywhere near its reported £11 million value, saying it looked like the forged valuation of the stone had been a "cut and paste" from a website.

By Business Editor Amy Bould