Engineering giant RCR Tomlinson goes into administration
23 November 2018, Written by Business News Australia
After 120 years in business, engineering and construction company RCR Tomlinson (ASX: RCR) has entered administration.
A statement from the engineering firm released this morning the company says it has appointed McGrathNicol as administrators to the company overnight.
Around 3,400 staff are now in limbo as the company beings its process to attempt to sell the company and seek funding from financiers.
"The administrators will work closely with RCR's employees, suppliers and customers to quickly stabilise operations and to determine the appropriate strategy for the business," McGrathNicol said in a statement.
The administration comes as a result of the company being unable to secure additional and important funding.
Today's news comes just days after the company announced that it is facing a class action in the NSW Supreme Court from aggrieved shareholders.
The class action relates to a massive share price plunge in August which followed RCR's disclosure of operational issues from two solar farm projects in Northern Queensland.
When RCR's shares were reinstated for trading on 30 August 2018, the share price fell by more than 60%, from $2.80 to $1.05, wiping out hundreds of millions of dollars of shareholder value.
The two solar projects have been written down to the tune of $57 million and its contractors have withdrawn workers off the farms.
The class action alleges that RCR Tomlinson breached continuous disclosure laws because senior management were aware, or should have been aware, of problems at the solar plants.
Business News Australia
Author: Business News Australia