Has Exeter based construction giant Midas lost its Golden Touch?

“One of the South West’s largest employers, the Exeter-based construction giant Midas, has reportedly filed a court notice of its intention to appoint an administrator.”

Steve Hindley, the Executive Chairman of the Midas Group, is also Chair of the “Great South West” which seems to have set itself up to take a leadership role for promoting economic growth across a number of neighbouring Local Enterprise Partnerships in the peninsular. 

In February 2020, with incredibly bad timing, “The Great South West” sent a report to Savid Javid just as he was replaced by Rishi Sunak, see: “The Great South West pitches to the wrong man. A week is a long time in politics” . Then the pandemic broke.

In July 2020 The Great South West appeared to be defunct, but it re-emerged in time for the G7 to publish a new, green, way forward in June 2021. This “greening” report, however, was  written by none other than one of the main polluters of our rivers and seas, the Pennon Group.

Currently we await Michael Gove’s “levelling up” White Paper, supposedly this week, but who knows what the government’s agenda is these days.

Concerns over future of SW construction giant

Colleen Smith www.devonlive.com 

The £290million turnover company filed the notice for itself and its main subsidiary Midas Construction Limited, the UK’s leading building trade resource Construction News revealed.

It follows a DevonLive exclusive yesterday which revealed that work had come to a virtual standstill on three major hotel construction projects worth £40m-plus in Torbay.

Midas is one of the region’s largest employers, with more than 400 people directly employed and supporting more than 10,000 jobs in supply chains.

The Exeter-headquartered business is ranked as the ninth largest in the Top 150 businesses in Devon and Cornwall 2021.

A notice of intention (NOI) typically means that a company will formally appoint an administrator within 10 days, unless it can find an alternative financial solution to its problems first. It follows the resignation of Midas Group’s commercial director Scott Poulter at the end of December and a nine-page Registration of Charge was posted on Companies House in mid January.

Administration is often used as part of a company restructure if the business is deemed viable. Directors can purchase some or all of the assets, and set up a ‘newco’ to move forward and save the business.

Midas is one of the region’s largest employers, with more than 400 people directly employed and supporting more than 10,000 jobs in supply chains.

The Exeter-headquartered business is ranked as the ninth largest in the Top 150 businesses in Devon and Cornwall 2021.

If they do enter administration there will be eight weeks in which to save the company, with sale as a going concern often the preferred option.

After months of concern within the building trade, fears for the company’s future mounted this week after the Fragrance Group spoke publicly to DevonLive about its fears for the lack of progress over the last three months at its twin £30m new hotel builds on Paignton seafront.

At the same time work ceased at the £11m construction of the Premier Inn in Torquay on The Terrace.

The company said its projects had been affected by the pandemic, Brexit, and labour and material inflation and shortages. “We are working closely with all our stakeholders to resolve the situation,” it said in a statement issued this morning.

A number of subcontractors have today revealed that they are owed five-figure sums by the company, whose HQ is in Pynes Hill, Exeter, and with offices stretching across the South West from Southampton to South Wales.

Last year the company reported a £2m pre-tax loss for the first time in it’s 40 year history. Midas is one of the UK’s largest privately-owned construction and property services companies.

Singapore-based Fragrance Group appointed Midas to build the two new hotels on Paignton seafront in January 2020, but after three months with little progress on the build their patience ran out this week.

A spokesperson for the group told DevonLive : “Over the past three months, the Fragrance Group has become increasingly concerned by the very limited progress on our two new Paignton seafront hotel developments, located on the neighbouring sites of the former Park Hotel and Lighthouse club.

“We are in constant discussions with the main contractors and are now reviewing our options to complete the development of these hotels.

“Our priority is to deliver these two new seafront hotels which mark a vital investment in the wider Torbay. We can confirm that the Fragrance Group is committed to Torbay.”

Torbay Council contracted Midas to build the £11m Premier Inn at The Terrace in Torquay. But after work stopped on site this week a council spokesman said on Thursday: “We are working with Midas to identify any issues that may be affecting the site and any required solutions.”

Midas works primarily in the commercial sector and also delivered jobs in the residential and education markets, with much of its work in the South West. In Torquay they are also currently building a new Special Educational Needs department at St Cuthbert Mayne school.

A spokesman for Midas told DevonLive yesterday: “As is well known in the industry there are issues relating to Brexit, Covid, ongoing shortages of materials and labour, and significant cost inflation, which are providing challenges to project delivery and timescales.

“We are working closely with all our stakeholders to resolve the situation.”