Aberdeen subsea and surface engineering company CIE Well Control has become the latest oil-related business to call in the administrators, with a drop off in client demand since 2015 battering its bottom line.
CIE has appointed KPMG UK restructuring head Blair Nimmo and Scottish restructuring director Geoff Jacobs as joint administrators after being hit by oil and gas operators cutting costs in the wake of the oil-price slump.
Design, precision engineering, welding and fabrication services specialist CIE was hit by clients seeking to reduce both capital and operating expenditure.
In a statement, KPMG said: “With the reduction in the volume of work available, margins were continually squeezed as competitors forced pricing downwards. This resulted in cash resources being depleted and ultimately required the directors to seek the appointment of administrators.”
Mr Nimmo at KPMG said that CIE was “yet another example of a business in the sector which has been negatively impacted by the low oil price and the consequent reduction in upstream activity resulting in cashflow challenges”.
A total of 21 staff have been made redundant from the company, which has been unable to complete ongoing projects for clients. Two employees have been retained to help the administrators wind up the business and market its assets.
“We are currently working with retained staff to realise all assets, and will provide all employees affected by redundancies with appropriate guidance and support,” said Mr Nimmo.
“We will be contacting the company’s customers and will do everything we can to seek a buyer who may be able to protect the company. We would encourage any party who has an interest in acquiring the company’s business and its assets to contact us as soon as possible. CIE has a strong reputation in its markets together with an asset base which will be of interest.”
The news comes after North Sea oil and gas businesses Iona Energy Company (UK) and Iona UK Huntington appointed administrators at the start of the year and Dundee offshore container manufacturer PressureFab did so in July.
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