Red7Marine, a service provider for offshore oil and gas, marine renewables, subsea engineering and marine civil engineering, has gone into administration, with 47 jobs lost.
Administrators from Ernst & Young (EY) have been appointed at Red7Marine Group Ltd, Red7Marine Ltd and Red7Marine Offshore Ltd.
This comes just a few months after the company boosted its subsea services by investment in diving support vessel Red7Alliance, followed by the expansion of ROV fleet with eight observation class ROVs.
However, the drop in oil prices, which led to offshore E&P and overall slowdown, has left the company in low demand for its services.
Administrators from EY said that Red7Marine’s inland and coastal division (I&C) was sold, securing 54 jobs, however, its offshore section has closed.
The job cuts from the group’s offshore business include 41 in Great Yarmouth, five in Aberdeenshire and one in Exeter.
Nine Great Yarmouth-based staff members have been temporarily kept on to help the administrators wind down the business, EY said.
EY’s Tom Jack, one of three administrators appointed, said: “The group’s cash flows came under significant strain due to falling demand for the group’s services as a result of the collapse of the oil price, ongoing investment in the group’s fleet, and a number of unexpected charges.
“Despite attempts to recapitalise the group, the directors were unable to do so and have been seeking alternative investment to support a turnaround of the business. This was not possible to achieve on a solvent basis and the Group has therefore been placed into administration by the Directors.
“The sale of I&C secures the future of 54 employees, ensures loyal customers will continue to be supported and preserves this profitable business as a going concern.
“It is with regret that the Offshore business could not be sold and has ceased trading. We will support all employees affected by redundancy at this difficult time, including helping them to make claims for amounts owing to them from the Redundancy Payments Service.”