A MAJOR British work boat company based on the Isle of Wight has called in corporate restructuring specialists after running into financial difficulty despite having multi-million pound orders on its books.
South Boats Special Projects Ltd in Cowes employs 120 people directly, but due to financial difficulties, the company, which manufactures service vessels for the offshore wind power industry, has called in restructuring experts from national accountancy firm and corporate recovery specialists Chantrey Vellacott DFK.
David Clements, partner and restructuring specialist at Chantrey Vellacott DFK, said: "South Boats is continuing to trade and fulfil its orders and we are working closely with the management team to conduct a full review of its business and are assisting the company in every way we can.
"The company employs around 120 people directly and has production and operations across two sites. It also currently sub-contracts work out to several other companies based in the Solent area.
"The root of the financial problems the company finds itself in today is mainly due to a combination of the challenge of rapid growth, significant design investment, new product introduction and expansion of manufacturing footprint.
"As a result of the above, cash flow has become critical and despite an order book of some £21 million and a further enquiry pipeline of some £35 million, the possibility of the company continuing without a further investor is not possible and in order to protect the company while further investment is sought, the directors have filed a notice of intention to appoint administrators.
"There are a number of investors and competitors who view the current position of South Boats as an attractive potential opportunity.
"The company has thrived since launching in 1996 and although it has suffered from market fluctuations in recent times its problems are by no means insurmountable.
"The firm is very much the market leader and is recognised as a pioneer in designing and manufacturing wind farm work vessels and we are confident with the right investment in place it can thrive again."