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Wrekin Construction's '£11m ruby' sold for just £8,000

17 Feb 10 The infamous ‘Wrekin Ruby’, a gemstone weighing 2kg that was central to the collapse of the eponymous construction firm, has been sold for just £8,000 – less than a one-thousandth of the valuation by its previous owner.

The infamous ‘Wrekin Ruby’, a gemstone weighing 2kg that was central to the collapse of the eponymous construction firm, has been sold for just £8,000 – less than a one-thousandth of the valuation by its previous owner.

The ruby, which is the size of a cricket ball, has been bought by recruitment outfit Network Construction Services.

The firm was one of around 1,000 creditors owed money by Wrekin Construction when the contractor collapsed last March.

Jon Smith, operations director for parent company Network Group Holdings, told The Birmingham Post: "It quickly became apparent to us following Wrekin’s collapse that we would be unlikely to recover what was owed to us through normal channels.

"We have therefore opted to make this strategic investment and the ruby has been placed in the Birmingham Deposit Centre for safekeeping where we hope it will continue to rise in value."

He said Network Group would be keeping the ruby off its own balance sheets.

Nearly 500 people lost their jobs at Wrekin Construction after it collapsed in March 2009. The contractor owed more than £20m to its creditors, plus another £20 million to its pension fund.

The ruby had been valued at £11m on Wrekin’s balance sheet. But it later emerged that the valuation was a forgery.

Administrators Ernst & Young said it had received over 60 offers for the gemstone before accepting a bid of £8,010 from Network Group Holdings.
 

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