Investors had been warned that unless extra working capital was secured, the group would have to go into administration. Its debts already total £129 million and its board expects that to increase to £175m this summer in order for the company to relaunch.
Industry sources expect the group to re-focus on the automotive training services which were the business’s original core. It currently runs apprenticeship programmes for 21 carmakers, including Volkswagen, Vauxhall, Toyota, Renault, Peugeot and Mercedes-Benz.
It will also retain the automotive operations added through its takeovers of ReMIT and Blackwater House.
However, its takeovers of several training companies in recent years, such as ASSA, NTP, Quantica, IMS (UK), Constant Browning Edmonds and NETA, have broadened its remit into other markets, such as construction, travel and tourism, sport and hospitality, retailing, food processing and distribution. These acquisitions cost the group more than £60 million and are expected to be sold.
David Galloway, director and chairman of Carter & Carter’s audit committee, said: “We still have a thriving business. The way the training is delivered and its student experience is unaffected, so it’s in everyone’s interest that the company continues to thrive as a training organisation.
“We have a fundamentally good business with some excellent people and an excellent student experience. It would be hugely damaging to lose that.”
At the EGM, Galloway said the five-month investigation into irregularities in the group’s financial records was “in its final throes” and he expected to have a draft report this week. There will be no criminal investigation. He also assured investors that the restructuring officer and finance officer were not members of the group’s former executive before the financial irregularities were detected last September.
Notably missing from the EGM’s panel was non-executive chairman and interim chief executive Rodney Westhead. Efforts to appoint a permanent chief executive have stalled but will recommence once the restructure plan has been finalised.