Double loss in N rth
Page 6
If you've noticed an error in this article please click here to report it so we can fix it.
by Karen Miles • Two major northern operators folded last week, putting nearly 400 jobs at risk.
Sheffield-based RDB Freight Lines and neighbour JG Osborne of Rotherham collapsed as management from both companies moved to end their financial crises. RDB called in receivers Arthur Anderson; Osborne decided to go into voluntary liquidation. Osborne holds its creditors' meeting today (Thursday) under the auspices of accountants Lennard Harris 8: Partners.
Within minutes of the moves other hauliers were on the hunt for surplus work and cheap assets: "It's very interesting that it happens just before Christmas—it's likely some customers will be let down," said one.
But as CM went to press RDB, at least, was still trading. Receiver Alan Katz from Arthur Anderson said: "We are in discussion with a number of interested parties. Meanwhile, workforce requirements are being looked at."
RDB's companies employ 350 staff and run 140 vehicles from depots at Sheffield, Leeds, Birmingham, Glasgow, Southampton and Hitchin, Herts.
The companies in receivership are RDB Freight Lines (Southern), RDB Freight Lines (Scotland), Bly Transport (Sheffield), John Dunn (Contractors), Palmer Brothers (Haulage), Sandygate Haulage Company and WG Cruickshank (Transport).
Katz blamed the recession for the collapse but it appears that a strategy to boost profit by pursuing high-street names in favour of traditional clients has floundered. An attempt to improve prospects by organising a management buy-out in February also failed to keep the business afloat.
The admission of defeat comes soon after strong public denials by RDB managing director Irving Warnett that the business was having problems. Less than two months ago he countered a writ for £38,000 from contract-hire specialist Hunter Hire, saying the £10m turnover company was profitable and planning to expand.
Warnett also contested the claim, saying his company owed Hunter "a fraction" of the sum.
Ron Osborne, director of international haulier JG Osborne, says he put his £2mturnover company into liquidation after financial difficulties were exacerbated by a series of disasters. For the year to date the company is expected to make a loss of £350,000.
The 25-vehicle operator gave notice to its 38 employees after its factoring company refused to release any more funds.
Last year one of Osborne's staff was murdered on his premises.
Later, South Yorkshire police investigated 147 alleged drivers' hours offences. Although the police did not bring a case, Osborne believes that the publicity surrounding the hours investigation, including subsequent public inquiries held by the North-East traffic area, hit his turnover by around £400,000 for the year to July 1993. A decision on whether any action will be taken against the company by the Deputy Traffic Commissioner as a result of the hours investigation is expected soon.
Osborne has since complained to the police about aspects of this investigation.
The company also lost up to £50,000 when a North-West finance and leasing company went broke.
Osborne, who has also received a threatening letter from his employee's murderer, says: "This is a £2m business and my wife and I are only earning around £150 a week between us. We haven't even got a company car...I think the omen was struck on this place after that laddie was shot."