John Dee goes under United stays in
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I at Multifreight
• John Dee Group — one of the UK's top 40 transport operators — has gone into receivership. It owes several million pounds to thousands of creditors. They include many small hauliers.
Receiver Cork Gully blames the company's downfall on its attempts to expand too quickly on borrowed finance. "It did not pay as much attention to detail as it should have," says Cork Gully spokesman Gordon Goldie.
The 11 companies in the group are continuing to trade while Cork Gully seeks a buyer. More than 40 enquiries have been received by potential buyers for all or part of the group.
Cork Gully will oversee the operation for at least a month while a buyer is sought — but even if one is found, Goldie believes that there will be redundancies among the 800 employees spread throughout the UK. Apart from property, the group's assets include 400 tractive units and 700 trailers.
No contracts have yet been lost, says Cork Gully. But the collapse has put extra pressure on smaller sub-contracted hauliers, such as PS Freight Express, which worked for John Dee distributing for Magnet, the kitchen furniture company.
PS boss Peter Ellis told CM that he is owed 224,000, and that a cheque for 29,600 received before Christmas has bounced. "It is pointless issuing a writ because they've got no money," he says.
On 1 January the group began a three-year/25.5m contract with British Coal, delivering equipment for colliery maintenance and repair from Sheffield to more than 100 UK
sites. "John Dee is still trading so we will continue to use it," says British Coal, "but we are keeping a close eye to see how things develop because this equipment is essential to the maintenance and repair of our collieries."
In February 1990 Courage, the brewing giant, signed up John Dee for a three-year/25m contract to deliver to 25% of its high street take-home outlets. John Dee invested £500,000 in new vehicles with the Courage livery and Courage intends to stay loyal to the group. "John Dee has given us certain assurances and we are confident there will be no interruption to deliveries," it says.
Fellow northern haulier Eddie Stobart could pick up business if John Dee ceases trading, but company secretary Barry Thomas says: "It's always sad when someone in the same line of business goes under, even if you stand to benefit."