Wrekin Construction - moving convoy of protest descends on HQ

A moving convoy of 500 ex-employees of Wrekin Construction are marching towards the group’s former headquarters office in Shifnal right now to demand answers as to why they’ve been left high and dry without jobs.

Wrekin went into administration last week.

Wrekin’s sad story quickly lurched from bland and normal – with Wrekin blaming RBS bank for chopping off its credit facility – to dazzlingly exotic within the space of a few hours. News surfaced that for the past two years it had probably only been kept afloat thanks to a massive £11m ruby which Wrekin bought from David Unwin when Unwin arrived with an offer to save the company.

Employees have been told that if they wish to come in today, between 11am and 3pm, then they would get an offer to individually discuss their redundancy situation.

However, they baulked at that offer, deciding instead to meet up at the edge of town in a service station on the M54 at 11am and then form a convoy of protest, one which is being heard right now.

But in the national media it is the ruby that has caught the headlines.

Wrekin justified its £11m value of the gem on the basis that its “fair value” was established by a professional valuer at the Instituto Gemmologico Italiano (IGI) based in Valenza, Italy on 31 August 2007.

There are two flaws in that story.

First, the institute was closed that day.

Second, Loridana Prosperi, a gemmologist at the institute’s head office in Milan has explained that the IGI only asses the quality of gemstone – never their price/value. And on top of that, the Valenza office does not even get involved in quality assessment work.

Wrekin paints the picture of the ruby actually existing, which is a positive sign.

On the other hand a certain vagueness has been presented by David Unwin (junior) who was invited by the Financial Times over the weekend to come clean with details.

The FT’s report said: “When asked ‘Where is the ruby?’ he replied ‘no comment’ as he did to the inquiry ‘does this ruby really exist?’”

David Unwin (junior) is the son of David Unwin who bought Wrekin two years ago and he is actively involved with his father in the Tamar Group.

Unwin (junior) was in his office this morning when CJ called, but the response was “he declines to take your call”.

Tamar owns Wrekin. During 2007, the year when it bought Wrekin, Tamar went from assets of £430,000 to net debts of close on £16m.

Apart from the ‘where is it?’ and ‘does it exist?’ uncertainties, there has been a groundswell of doubt over the £11m valuation figure, with Christie’s reporting that the highest recorded price paid for a ruby is £2.6m in 2006.

Ernst & Young have identified a number of issues, though there is no detail as to the nature of them.

A spokesperson said in an official statement: “Having looked at the current financial position of Wrekin Construction, the joint administrators have unfortunately no alternative but to announce the redundancies of 420 Wrekin Group employees.

“Approximately 65 employees have been retained to assist in winding down the business.

“There are a number of issues which have already been identified.

“Over recent months, credit insurance for Wrekin Construction has been reduced or withdrawn completely.

“Amounts due to the Crown in respect of VAT and PAYE appear to exceed £3.5m. Amounts believed to be due to Wrekin Construction in respect of government contracts exceed £2m.

“Over the last 12 months Wrekin invested £2m in relation to land for redevelopment and the acquisition of two businesses – Toft Johnson Construction and Watson Dallas.”

When Wrekin went into administration it was the subject of five winding up petitions and approximately 40 County Court judgments.

• Wrekin protest video