Caldwell Construction has entered administration, following mounting pressure on cashflow and operations.
The business employs more than 400 people, with revenue to March 2025 of around £58m.
Based in Stoke-on-Trent and Warrington, the contractor provides groundworks services for several national housebuilders.
PKF Littlejohn Advisory has been appointed as administrator.
Paul Smith, a partner at PKF Littlejohn Advisory, said: “The construction sector has faced challenging trading conditions over recent years, including increasing costs, delays to schemes and wider market uncertainty.
“These pressures were exacerbated at Caldwell in recent weeks, placing significant strain on cashflow and operations.
“The PKF Littlejohn Advisory team in Manchester and Leeds had worked closely with Caldwell’s management over the past few months to explore all available options and potential solutions for the business.
“Unfortunately, despite extensive efforts, it was not possible to secure a way forward that would allow the company to continue trading outside of an insolvency process.”
Concerns for the supply chain
Commenting on the announcement, Nick Stockley, partner at law firm Mayo Wynne Baxter, said there is a chance the company could be rescued and restructured, but there will likely be a negative impact on the supply chain.
“As Caldwell Construction Limited has gone into administration, there will be a better chance of either rescuing the company as a going concern or providing a better return to creditors than if the company went into liquidation,” Stockley said.
“In a situation like this, the administrators will see if there is some chance that the company can be rescued. As the company is making an annual revenue of £58.4m there appears to be a viable business there.
“However, the company may be suffering from significant cashflow difficulties which leave it ‘unable to pay their costs as they fall due’.
“The process of administration gives the company protection from immediate legal action whilst the administrators consider how the business can be restructured.”
Stockley explained that this process will likely involve either a significant downsizing restructure and/or a sale of the company’s assets.
“Regardless of what rescue measures are considered, jobs will inevitably be lost and creditors will not be paid – that will have a negative impact up and down the supply chain,” he said.
“The company’s directors will have appointed administrators to protect themselves from personal liability. They have also given themselves the chance of setting up a new company which can take on existing contracts and, where possible, limit the damage to the supply chain.”
