Blair Nimmo and Geoffrey Jacobs have been appointed Joint Administrators of GOT Limited & GOT Services Limited and hope to sell as much as possible of the company, most likely in a trade sale.
GOT was set up in 1992 and specialised in the procurement of equipment for the oil and gas sector comprising hand tools, consumables, instrumentation, pipe tools and personal protection equipment.
The company traded from leasehold premises in Aberdeen and had 23 employees at the time of appointment. In 2013 and 2014 the Group invested significantly in its premises and infrastructure. Additional funding to support growth was secured and employee numbers increased.
But following the oil price decline, orders reduced substantially which, coupled with price pressure, rapidly reduced turnover and margin. As a result, the director decided there was no option other than to seek the appointment of Administrators.
Although there was a significant order book at the time of appointment, GOT did not have the stock required to fulfil the orders and most staff had no ongoing work to undertake. Given the circumstances, Joint Administrators had no option other than to make 19 of the Group’s 23 employees redundant with immediate effect.
The remaining four employees have been retained to assist the Joint Administrators realise the Group’s assets and are currently exploring whether an early sale of the business, infrastructure, and assets can be secured. Blair Nimmo, Head of Restructuring for KPMG in Scotland and Joint Administrator, said:
“We are seeing the impact of the oil price decline extend down the supply chain and our appointment today is a clear example of the challenges the industry is currently facing.
“GOT is well known in the sector and has a considerable order book from its client base which includes some global oil and European companies.
“Unfortunately, due to trading circumstances, we have had no option but to reduce the size of the workforce. We will be working with the employees and the relevant government agencies to ensure a full range of support is available to all those affected.”
N. Sea oil tax cuts forecast
Meanwhile, an oil industry expert is forecasting further cuts in N. Sea oil taxes in the Chancellor’s second emergency budget this year on Wednesday (8 July).
Martin Findlay, Head of Tax at KPMG in Aberdeen, said: “We fully expect to see further extensions to the oil and gas reliefs announced in March which will no doubt be coupled with the re-announcing of those benefits.
“At current and projected oil tax revenue levels, it’s unlikely for there to be huge benefit to the Exchequer. However, it should go towards creating further positive impact on industry sentiment, particularly in terms of marginal field development, fiscal stability and its general direction of travel.”