Joint administrators David Hudson and Geoffrey Rowley of FRP Advisory said there could be enough money to pay a dividend to unsecured creditors — but only if ongoing litigation delivers successful recoveries.

Henry Construction Projects crashed into administration in June 2023 owing more than £43m to its supply chain, with over 5,000 unsecured creditors caught in the fallout.

In its latest progress report, FRP said any return to trade creditors hinges on the outcome of claims totalling around £31m that have been brought against former directors and members of the Henry family.

“It remains the position that there may be sufficient funds available to pay a dividend to the unsecured creditors in due course,” the administrators said. “However, this position may change subject to the success or otherwise of the legal claims on foot.”

The largest claim centres on a £10m payment made by the failed contractor to its parent company in January 2023, described as a dividend despite the parent owing the same sum back to the business.

Days before Henry collapsed, the £10m was then paid on to Elizabeth Henry — a minority shareholder, former director and the mother of director Mark Henry.

FRP is now seeking to recover the money plus interest, alleging breaches of fiduciary duty, transactions at an undervalue and transactions defrauding creditors. The parent company has since assigned its rights over the £10m to the administrators and been removed from the proceedings.

A second strand of litigation targets a group of property and hotel companies linked to the Henry family — known as the Keash companies — which FRP claims owe around £15.8m to Henry Construction Projects.

The administrators allege the sums arose from loans and other transactions recorded in the firm’s accounts.

The defendants dispute the figures, claiming repayments, set-offs and counterclaims linked to construction works. FRP says it has rejected those arguments in its formal reply.

A third claim, valued at about £5.5m, relates to payments and construction works allegedly carried out for the personal benefit of family members, including unpaid works at private homes, the settlement of personal tax bills and an outstanding director’s loan balance.

FRP says the three sets of proceedings are now being case-managed together and could ultimately be heard in a single trial.

The administrators confirmed that £67,000 owed to 54 redundant employees has now been paid in full. HMRC still has an unsecured claim of around £1m.

FRP has extended the administration to June 2027 to allow the lengthy investigations and court actions to run their course — with trade creditors warned that without courtroom success, there will be no payout.