HIE Comment in response to Rok Announcement

8th November 2010

Highlands and Islands Enterprise has been in contact with Rok's administrators, Pricewaterhouse Coopers (PwC). We are seeking an early meeting with PwC to discuss both the future of the business as a whole and how we progress specific HIE projects currently being delivered by Rok.

Our priority is to ensure that projects in HIE's Operating Plan, including Arnish, Raasay House and Machrihanish will be completed despite this setback.

The HIE Property Framework Contract which Rok was awarded earlier this year was set up to provide a single contractor which would undertake the majority of HIE's construction needs over the next four years.

Two projects have been awarded so far, though neither has yet begun. These are phase one of the European Marine Science Park at Dunstaffnage, near Oban (valued at �7.5m) and recladding industrial buildings at Arnish Point, Stornoway (�3m).

In addition, two further projects awarded to Rok under a previous HIE contract are currently under way: the rebuilding of Raasay House (�8m) and site works at the renewable energy manufacturing plant in Machrihanish (�4.9m)

Background
Building services company Rok had reported �3.8m half-year loss after problems in its plumbing, heating and electrical arm.

The board of building services company Rok said today that it would place the firm into administration just months after it revealed sizeable losses and financial shortcomings at its plumbing division.

The company won a recent contract win with insurance giant Axa and Exeter-based Rok, which employs more than 2,000 tradespeople, said it would place the company into administration and had applied to the Financial Services Authority to suspend the listing of its shares.

Rok, reported half-year losses of �3.8m a few months agao, shortly after an independent review by accountants BDO uncovered serious failings at its plumbing, heating and electrical (PHE) business.

Garvis Snook the chief executive took over the running of the firm in 2000, when it was known as Exeter Building Contractors (EBC).

The company was losing money and had a pension deficit. By 2007Mr Snook had changed the fortunes of the company. He took the company's market value from �7m (as EBC) to �322m. Rok deals with a wide range of services from general repairs to medium-sized construction, and has about 30 regional bases.