As first reported in the Enquirer the steelwork firm’s family owners have been in rescue talks to save the firm from collapse with business turnaround specialist R Capital for several weeks.
The Robinson family was faced with closing the 46-year-old firm’s doors for good this Christmas after cash reserves were eaten away in the downturn.
A round of redundancies is due to take place as the business is restructured, but the deal saves most of the 229-strong workforce.
The new ownership agreement secures the future of one of the country’s top 10 steelwork firms, which in its heyday turned over £40m annually.
Jamie Constable, CEO at R Capital, said: “Robinsons was up for sale for more than a year and many in the industry feared it would be closed if a buyer could not be found.
“That would have been a great shame for the UK’s construction industry so we are delighted to have reached an agreement in time for Christmas.”
Under the deal, the current boss John Robinson will retire and financial director Mike Newton will step up to lead the existing management team as new MD.
Matt Swan, a former senior manager at construction group McAlpine, has been appointed as non executive chairman by RCapital.
Newton said: “The past two years have been extremely tough for the construction industry with unprecedented challenging market conditions and we have seen many of our competitors in distress.
“We are therefore not alone in suffering from the effects of the dip in the construction industry, which has led to a dramatic downturn in demand for steel structures nationwide from 1.4m tonnes output in 2008 to 700,000 tonnes this year, coupled with a consistent increase in the price of steel.”
Following the 2007 banking crisis, Robinson’s business levels almost halved from £43m in 2008 to £29m in both 2009 and 2010.
A £7m cash reserve insulated Robinsons from the initial effects of the crisis however this could not be sustained as a long-term solution.
Cuts were made by the existing management team during the course of 2009 however high costs placed the company under immense cash pressure.
This resulted in suppliers ceasing their support as the business struggled and eventually led to the recent need for fresh investment.
“It has effectively given us the working capital to rationalise and restructure to work our way out of this extremely tough trading climate and has put the company on a secure footing for the future,” explained Newton.
“As with all construction businesses, market conditions have been tough and, although they are stabilising, there is no doubt that the next 12 to 18 months will continue to be difficult.
“We will have to make some job losses in January which is obviously unfortunate and where possible will be undertaken by voluntary redundancies.”
