A brief statement this afternoon said: “The administrators have taken possession of the gemstone reported to be the Gem of Tanzania which will be retained in secure storage while they continue there enquiries.”
Back in 2007, Wrekin’s deeds of agreement named a jewel known as the Star of Zanzibar as being at the heart of the transaction to give Wrekin a new owner.
Current thinking is that the two are in fact the self-same item.
The collapse of Wrekin Construction two weeks ago – now in administration but expected to fall into liquidation soon – could result in many of its subcontractors also folding.
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Darren Davoile, debt recovery manager with debt recovery lawyers Coltman Warner Cranston said: “In addition to the 600 job losses within Wrekin, the smaller businesses that supplied it will take a further hit. I doubt if some will survive.”
Prior to going into administration a fortnight ago, Wrekin had been also facing a winding up order, issued on 15 February.
Triggered initially by a single creditor seeking the return of a relatively “negligible amount”, it had gathered momentum with a result that 20 other Wrekin creditors had joined in with the petition.
It total, the group were seeking payment of a total of ВЈ1.3m owed to them.
The group of 20 included medium-sized subcontractors and even one-man enterprises.
“The average debt owed to them is £50,000-£70,000 and for some this could be 10% of their annual turnover,” said Davoile, “as Wrekin was perceived as one of the good guys.”
Creditors had been struggling to get their money from Wrekin since before Christmas.
The fact that a high percentage of Wrekin’s 600 staff were gone within 24 hours of going into administration, can be taken to show that Ernst & Young had no intention of selling it as a going concern, believes Davoile.
“It will likely go into liquidation,” he says.
With £2.5m owed through VAT, it was unusual that the government department hadn’t dived in to support the winding up order, the convention being that the VAT people usually jump onto a bandwagon when they feel themselves to be at risk of not being paid.
It is thought that Wrekin could have debts running to more than ВЈ10m., all in all.
Wrekin ruby saga - Tanzania gem now on eBay
Wrekin ruby saga - valuation jumped from £300,000 to £11m
