The mysterious ‘Wrekin Ruby’, the two-kilo gemstone that caused the collapse of one of the Midlands’ most high-profile construction firms, has been sold for just £8,000 - more than a thousand times less than the value it had earlier been given.
The ruby, which is the size of a cricket ball, has ended up in the hands of Network Construction Services, part of the Network Group headed by well-known local recruitment entrepreneur Tim Watts.
Network Construction had bid for the gemstone, and after more than 60 bids, secured it from the auctioneers. It said it was owed "a considerable sum" by Wrekin at the time of its collapse.
Jon Smith, the group operations director for Network Group Holdings, said: "It is certainly one of the most unusual cases I have ever come across in my career.
"However, 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.
"At Network Group Holdings we are used to unearthing a few gems for our clients – well now we have one of our own."
He added Network Group would be keeping the ruby off its own balance sheets.
Nearly 500 people lost their jobs at Wrekin Construction after it collapsed through lack of funds in March this year. It later emerged that the inflated valuation of the ruby was a key reason behind the collapse.
The company owed more than £20 million to a list of about 1,000 creditors, plus another £20 million to its pension fund. The ruby, weighing more than 10,000 carats (two kilos), was valued at £11 million on the accounts of the collapsed firm.
But it later emerged that the valuation documents were a forgery, and that wildly different value estimations had been made before in the gem’s history.
A spokesman for administrators Ernst & Young said: "Following a thorough marketing process managed by GVA Grimley Limited, including national media coverage and specific advertisements in specialist press, the joint administrators of Wrekin Construction Limited can confirm the successful sale of the Gem of Tanzania to Pertemps Investments Limited.
"Following the deadline for offers on December 16, at which point in excess of 60 offers had been received, the highest bidders were invited to inspect the gemstone. Further to approval from the Creditors Committee of Wrekin Construction Company Limited, a bid of £8,010 was accepted."
The ruby had been put up for auction by administrators after it appeared on the books of the collapsed Shropshire building company Wrekin Construction.
more details to follow