Scottish Coal has gone into liquidation, with the loss of 590 jobs, the vast majority of which are in Clydesdale.
Blair Nimmo and Tony Friar, of KPMG, were appointed Joint Provisional Liquidators of The Scottish Coal Company Limited (Scottish Coal) at the Court of Session in Edinburgh on Friday. The move was made at the request of the company’s directors.
Some 590 employees were made redundant and all operations ceased immediately following the insolvency appointment.
By far, the largest number of job losses are in the Clydesdale area – with 319 people made redundant as a consequence of the liquidation and another 131 likely to follow suit.
Around 142 employees have been retained to assist in securing the sites while the Joint Provisional Liquidators explore how best to maximise returns from the assets of the business, principally the sites, plant and stocks.
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 would like to thank staff for their co-operation through this difficult process. We will be working with the employees and the relevant Government agencies to ensure that the full range of support is available to all those affected.
“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.”
At Broken Cross in Douglas Water 236 people have been made redundant and only 45 retained; at Mainshill in Douglas 74 are now redundant and just 12 retained; at Glentaggart in Glespin two people have lost their jobs; and at Poneil one job has been axed.
Also on the scrap heap are six jobs at Scottish Coal’s Ravenstruther transport terminal, where one post will be retained in the meantime.
While no jobs are at risk, Dalquhandy in Coalburn is also listed as one of the company’s assets.
Around 450 staff were placed on notice of redundancy on March 7 2013 as the company sought to restructure its activities.
A fellow subsidiary company, Castlebridge Plant Limited (CPL), was also placed into administration at the same time, with Blair Nimmo and Tony Friar appointed Joint Administrators.
With a history dating back to 1994, following the privatisation of British Coal, Scottish Coal operates six open cast coal mines in Scotland, located in East Ayrshire, South Lanarkshire and Fife. Together with the plant operator, CPL, the business employed a total of 732 people.
Scottish Coal has been suffering from 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. Despite significant efforts in recent months, the company was unable to secure the level of investment required to enable the business to continue.
Any parties with an interest in acquiring the business and assets should contact Blair Nimmo in KPMG’s Edinburgh office on 0131 222 2000 or in writing at Saltire Court, 20 Castle Terrace, Edinburgh, EH1 2EG.
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