Debt of £10m sinks Galliers

Shropshire construction firm Frank Galliers Ltd today went into liquidation with debts of almost £10 million owed to more than 400 creditors.

Directors of the Shrewsbury company were at a meeting in Telford to explain why the firm ceased trading with the loss of more than 130 jobs.

Director George Butler today laid the blame for the liquidation firmly on a dispute with the Centre for Alternative Technology in Machynlleth which left Frank Galliers with a bill for more than £500,000.

Speaking for the first time since the company shut its doors last month, Mr Butler said he was "hugely disappointed" that the company had been forced into voluntary liquidation.

He said: "Our opinion is that this was an unfortunate contract dispute.

"Two days after we ceased trading, I understand the company was the lowest bid on a large project in the town worth around £6 million and there was another possible project where we were also the lowest bidder.

"Had it not been for the contract dispute which has caused the demise of the company, and if a compromise had been reached with that party, then I feel sure that the situation would be very different from what it is today."

The Centre for Alternative Technology was awarded the settlement last month following an investigation by an independent adjudicator following a dispute with Frank Galliers over a £5.4 million building project at the site.

Phil Horton, a spokesman for CAT, said: "The Centre for Alternative Technology refutes Mr Butler's allegations.

"Galliers owe a total of £9.9 million to a wide range of creditors, of which CAT is only one.

"CAT is owed £530,000 as a result of Galliers failing to deliver on a contract, the amount has been determined by an independent adjudicator and upheld by the High Court."

Mr Butler came under fire in the meeting over a £4 million sum listed as an asset in the directors' statement of affairs, which is understood to be a debt owed to Frank Galliers Ltd by other companies in the Pan Atlanta group.

Creditors said Mr Butler and company secretary Darren Williams failed to give a satisfactory answer as to why the paper debt of £4 million could not be realised during the meeting.

By Business Editor Amy Bould