Civils firm faced ‘significant’ trade debt before collapse
Summary
Avtar Construction entered administration after accumulating significant trade debt, losing its overdraft support and facing a winding-up petition. Administrators say the Wiltshire-based civils contractor could not be sold as a pre-pack because of limited cash, low tangible asset value and insolvency-triggered contract clauses.
Why it matters
While this is a contractor insolvency story rather than a direct surveying issue, it highlights counterparty risk, payment stress and the potential for disrupted projects and unpaid supply-chain claims. Surveyors involved in contract administration, due diligence or monitoring works should note the warning signs around liquidity, retentions and insolvency clauses.
Key points
- Avtar Construction entered administration after failing to discharge trade debt.
- Administrators cited withdrawal of overdraft support, bad debt, late payments and rising financing costs.
- The firm reportedly owed about £6m to 276 unsecured creditors and is not expected to pay them.
- A pre-pack sale was ruled out due to limited cash, low tangible assets and insolvency-triggered contract clauses.
- Kinetica has been engaged to recover book debts and retentions, but recovery is described as highly speculative.
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