Sale saves 39 jobs after Tipton metal recycling group enters administration
A deal has secured 39 jobs after a Black Country scrap metal recycling firm and its logistics subsidiary went into administration.
Tipton-based Enablelink Limited and freight transport firm MT Transport (UK) Limited entered administration after months of rapidly deteriorating financial performance, with Raj Mittal and Ben Jones of FRP Advisory Trading Ltd appointed as joint administrators.
Global Ardour Recycling, however, has since acquired Enablelink’s processing sites in Great Bridge and Coseley - safeguarding 39 jobs.
It's understood the businesses had faced significant challenges presented by lower prices and volumes for recyclable metals, amid depressed local and global industrial demand.
A statement issued by the administrators said Enablelink, which processed more than 300,000 tonnes of material per year, had suffered the effects of global economic conditions and trade issues on scrap metal volumes and prices - despite significant investment by private equity investor Endless in new capabilities for shredding and processing ferrous and non-ferrous metals.
It added that although recycled raw materials are critical to the UK and worldwide steel and manufacturing industries long-term, as well as playing a vital role in the green circular economy, several factors conspired to depress prices and volumes. Low growth in major economies - particularly with the EU, new tariffs on scrap and auto parts, volatile demand from the steel industry and higher processing costs have resulted in significant pressure on liquidity and the companies’ ability to trade.
Following an extensive marketing exercise by FRP Advisory, a pre-pack transaction was agreed with Global Ardour Recycling, a leading ferrous and non-ferrous metal processor with a national footprint, to acquire Enablelink’s processing sites in Great Bridge and Coseley. The deal, which completed on December 22, has secured 39 jobs.
Raj Mittal, joint administrator and Partner at FRP, said: “Enablelink is a well-established operator with a strong reputation in the metal recycling sector, but like many businesses in this industry, it has faced complex headwinds.
“Global economic pressures, shifting trade conditions and rising costs have all had a significant impact on trading performance. We’re pleased to have been able to secure a sale that preserves continuity at two key sites and safeguards jobs.
"Our focus now is on engaging with stakeholders and working to achieve the best outcome for the remaining parts of the business.”
