Balfour Beatty is offering a lifeline to its supply chain subcontractors impacted by the collapse of ISG.
The firm is aiming to stop any contagion from ISG’s collapse spreading to its own projects.
The move to support cash-strapped subcontractors comes amid widening concern that scores of firms have been seriously hit.
Already London-based building services specialist Phoenix ME has issued a statement reassuring its client and suppliers that it will be able to ride out the hit on its business.
In its statement, Phoenix said: “We have and continue to conduct a thorough review of our accounts and can confirm that our financial exposure to ISG is not so extensive as to pose a risk to our company’s financial standing.
“We remain fully operational and are committed to continuing all projects (as permitted by ISG’s administrators) as planned. Our financial position ensures that we can sustain operations and provide continuity of service to our diverse clients.”
As well as the M&E sector rumours are spreading that several dryling firms have taken big hits.
Procurement heads at Balfour Beatty UK Construction Services building and civils operations have emailed firms asking them to complete a confidential survey rating the impact on their business from high to low.
The email said: “We wanted to reach out to understand the levels of support we may need to offer you in these challenging times.
“We understand that this will have an effect within our industry and are contacting our key supply chain to understand if this will have an impact on your business, and what that may look like with regards to your exposure.”
The questionnaire also ask firms to estimate the value of outstanding payments from ISG.
One firm told the Enquirer: “From what I understand the aim its to support subcontractors that have been badly impacted by easing cash flow pressures.
“It seems firms will be assessed on a case by case basis and could see Balfour speed up payments.”
