Struggling energy consultancy Utilitywise has called in the administrators with hundreds of jobs potentially set to be axed.
The north Tyneside-headquartered firm recently delayed the publication of its accounts for a second time and announced that it is up for sale after auditors BDO called into question how it estimates revenues.
FTI Consulting has been appointed to take charge of its enterprise division after it was 鈥渦nable to raise sufficient funding to cover trading losses and implement the turnaround strategy required鈥�.
Despite reports yesterday that founder Geoff Thompson had put together a very credible rescue package, the company said it had not received any offers to buy either the enterprise division or the company as a whole, although other parts of the group are still up for sale.
Administrator Andrew Johnson said there will be a 鈥渟ubstantial鈥� number of redundancies at the firm, which employs 1,000 people.
鈥淕iven the absence of a potential purchaser for the enterprise division and the continuing significant losses within that part of the business, we are unable to continue to trade, and will cease the operations of the Enterprise division immediately,鈥� he said.
鈥淭his will unfortunately result in a substantial number of redundancies, primarily at [its] head office in Newcastle.
鈥淲e have received expressions of interest from a number of parties for [its] subsidiary companies Icon Communication Centres and Energy Intelligence Centre Limited, which operate the Europe division and corporate division respectively.
鈥淭hese companies are not in an insolvency process and continue to operate on a 鈥榖usiness as usual鈥� basis, with the full support of the group鈥檚 lender, whilst the sales process continues.
鈥淲e intend to conclude the sales processes in respect of these subsidiaries in the coming weeks.鈥�
Its share price stands below 2p after trading in them was suspended on February 1st. The price has plummeted from around 40p last January and peaked in 2014 at 拢3.70.
Utilitywise said a fortnight ago that 拢10 million investment is needed to make further strategic changes in order to improve revenue streams.
Negotiations over the refinancing of its existing banking facility of 拢25 million have also stalled until Utilitywise can secure further equity investment, the firm said.
It has stated the need to prioritise its Internet of Things solutions and the creation of a digitally driven channel 鈥渢argeting micro-SME customers and offering a multi-utility bill management service with automation at its core鈥�.
Last year Utilitywise, which has 27,000 customers, repaid 拢7.6m to a leading energy company after it overestimated energy use.