Management teams at Baldwins Industrial Services in the UK and its subsidiary Phillips Crane & Rigging in the USA are seeking to secure the future of their companies.
The Phillips management, led by Larry Bonnin is working on taking ownership of the Texas-based company that filed for Chapter 11 bankruptcy protection in August.
Meanwhile in the UK, a management buyout bid led by 43-year-old managing director Rick Barnett was among the bids submitted with the administrative receivers by the 19 November deadline.
Baldwins chairman and chief executive Richard Baldwin, and his son, operations director Wayne, left the company within days of the administrative receivers coming in on 28 October. Though the Baldwins family owns 63% of the company, they are considered unlikely to receive much from the sale, given that the company has about £83m ($125m) of borrowings at time of going under, which is about equal to one’s year turnover.
Barnett said that the UK business remained profitable and only went into administrative receivership because Baldwins had guaranteed Phillips’ debts. The UK parent had guaranteed £7.2m ($10.5m) in US finance lease obligations and £3.6m in respect of operating leases.
‘America was a poorly conceived plan,’ said Barnett, who joined the company in April 2001. ‘The underlying UK business is solid.’
Given the state of the US market, there are unlikely to be too many bidders competing for Phillips, whose fleet includes several big Demag crawlers including two CC 4800s (which once saw service at Chernobyl in the Ukraine), three CC 2800s, two CC 1800s and four Kobelco CK 2500s – as well as telescopics ranging up to a Liebherr LTM 1400 and a Demag AC 650. Bonnin said it was likely that if the company moved forward under management ownership, it would be with a smaller fleet to reflect the decline in heavylift demand from the energy sector. At peak, under Baldwins, Phillips’ fleet reached 51 units. Many of those that failed to produce a return on investment have already been returned or sold on.
