Around 100 jobs have been axed after ESS Modular, part of former ISG owner Cathexis’ portfolio, appointed administrators.
Administrators from Ernst & Young (EY), which is also handling the administration of eight ISG subsidiaries, were appointed yesterday (23 September) for ESS’s trading company Extraspace Solutions (UK) and wholly owned subsidiary Spatial Initiative.
The companies have ceased to trade with immediate effect and the majority of 100 staff members will be made redundant, an EY statement said.
Extraspace Solutions (UK) posted a pre-tax loss of £15.4m from revenue of £31.5m in its most recent full-year accounts for the 12 months to 30 June 2022.
ESS Modular experienced “significant losses” on legacy contracts, which caused “severe liquidity pressures”, the statement added. It said shareholder funding had alleviated cashflow pressures until this point, but the firm now needed more cash funding to continue to trade.
Company directors opted to place the companies in administration after attempts to secure additional funding proved unsuccessful.
The Hull-based modular specialist was part of former ISG owner Cathexis’ portfolio. Companies House lists ISG chair Matt Roche as a director of Extraspace Solutions and Spatial Initiative. The firm rebranded from Extraspace Solutions to ESS Modular in 2019 and fully acquired Spatial Initiative in 2020.
Tim Vance, Charles King and Andrew Dolliver from EY-Parthenon’s turnaround and restructuring team took on joint administration of Extraspace Solutions (UK), with Vance and King also administrators for Spatial Initiative.
Several ESS Modular staff have taken to LinkedIn to look for jobs, writing that they were looking for new roles with “immediate effect”.
Less than a month ago, ESS Modular was one of six companies appointed to a six-year framework from the Defence Infrastructure Organisation (DIO) to build living accommodation for the British Army.
ESS Modular and the DIO have been contacted for comment.
