Released April 23, 2013 | GALWAY, IRELAND
en
Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland) - One of Scotland's leading coal producers, Scottish Coal (Alloa, Clackmannanshire), has gone into liquidation with the loss of almost 600 jobs.
Liquidators from the accountancy firm, KPMG, were called in at Scottish Coal last Friday, to oversee the process. Scottish Coal is the main trading subsidiary of Scottish Resources Group Limited. Fellow subsidiary company, Castlebridge Plant Limited ("CPL"), was placed into administration at the same time. The creation of Scottish Coal dates back to 1994 following the privatisation of British Coal. It operates six open cast coal mines in Scotland, located in East Ayrshire, South Lanarkshire and Fife. A further 140 workers have been retained by KPMG but only to secure the mines, including the largest, Broken Cross in South Lanarkshire.
Last month, Industrial Info reported that Scottish Coal was planning to axe hundreds of jobs at a number of opencast mines across Scotland as the company struggled to survive. For additional information, see March 27, 2013, article - Scottish Coal to Shut Mines.
KPMG said the company had been suffering from a series of 'well publicised difficulties'.
"A combination of falling coal prices, rising operational costs (particularly fuel) and a number of Scottish Coal sites exhausting their reserves has contributed to trading losses and significant cash flow pressures," it stated. "Despite significant efforts in recent months, the company was unable to secure the level of investment required to enable the business to continue."
Blair Nimmo, Joint Provisional Liquidator and Head of Restructuring at KPMG in Scotland said: "In light of Scottish Coal's poor trading and financial position, we have had to cease trading with immediate effect. It is extremely regrettable that we have had to make so many redundancies but have been left with no other option. We will be looking to secure the sale of certain sites as well as the company's key assets in the coming weeks. It is still possible that mining operations will continue and offer future employment prospects for at least some of the people who have lost their jobs today."
Following the news, the Scottish government announced a plan to set up a new trust that will help restore old open cast mines across Scotland, which it hopes will lead to the creation of hundreds of jobs over time.
Scottish Energy Minister Fergus Ewing commented: "Our concerns remain with the workers and families affected by the decision to make 590 Scottish Coal staff redundant. However I very much welcome the view from the liquidators that there is a possibility that mining operations may continue."
He added: "We have been working closely with the key stakeholders over the past six months to address the issues facing the coal industry in Scotland and we share the concerns raised by local communities around the responsible restoration of open cast coal sites. I am therefore pleased to announce that we are setting up a new trust to help facilitate the restoration of old open cast coal mines across Scotland. Whilst our main concern is to retain as many of the existing Scottish Coal jobs as possible, the restoration process itself is expected, over time, to create hundreds of jobs across the country -- as well as restoring the local environment".
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
Liquidators from the accountancy firm, KPMG, were called in at Scottish Coal last Friday, to oversee the process. Scottish Coal is the main trading subsidiary of Scottish Resources Group Limited. Fellow subsidiary company, Castlebridge Plant Limited ("CPL"), was placed into administration at the same time. The creation of Scottish Coal dates back to 1994 following the privatisation of British Coal. It operates six open cast coal mines in Scotland, located in East Ayrshire, South Lanarkshire and Fife. A further 140 workers have been retained by KPMG but only to secure the mines, including the largest, Broken Cross in South Lanarkshire.
Last month, Industrial Info reported that Scottish Coal was planning to axe hundreds of jobs at a number of opencast mines across Scotland as the company struggled to survive. For additional information, see March 27, 2013, article - Scottish Coal to Shut Mines.
KPMG said the company had been suffering from a series of 'well publicised difficulties'.
"A combination of falling coal prices, rising operational costs (particularly fuel) and a number of Scottish Coal sites exhausting their reserves has contributed to trading losses and significant cash flow pressures," it stated. "Despite significant efforts in recent months, the company was unable to secure the level of investment required to enable the business to continue."
Blair Nimmo, Joint Provisional Liquidator and Head of Restructuring at KPMG in Scotland said: "In light of Scottish Coal's poor trading and financial position, we have had to cease trading with immediate effect. It is extremely regrettable that we have had to make so many redundancies but have been left with no other option. We will be looking to secure the sale of certain sites as well as the company's key assets in the coming weeks. It is still possible that mining operations will continue and offer future employment prospects for at least some of the people who have lost their jobs today."
Following the news, the Scottish government announced a plan to set up a new trust that will help restore old open cast mines across Scotland, which it hopes will lead to the creation of hundreds of jobs over time.
Scottish Energy Minister Fergus Ewing commented: "Our concerns remain with the workers and families affected by the decision to make 590 Scottish Coal staff redundant. However I very much welcome the view from the liquidators that there is a possibility that mining operations may continue."
He added: "We have been working closely with the key stakeholders over the past six months to address the issues facing the coal industry in Scotland and we share the concerns raised by local communities around the responsible restoration of open cast coal sites. I am therefore pleased to announce that we are setting up a new trust to help facilitate the restoration of old open cast coal mines across Scotland. Whilst our main concern is to retain as many of the existing Scottish Coal jobs as possible, the restoration process itself is expected, over time, to create hundreds of jobs across the country -- as well as restoring the local environment".
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
