It will have been almost impossible to have missed the news that Carillion is in Liquidation. No step through Administration – just a straight break up and sale of the assets!
This, in itself is quite unusual (although we are a little more used to the failure of plc’s these days – sadly). It also has massive implications for any Sub-Contractor or Supply Chain business with uninsured debts.
Clearly any business which has factored or discounted an uninsured Carillion invoice, or is simply owed significant sums (significant to the creditor, irrespective of size) may now start to have to face challenging conversations with its bankers.
The High Street Banks will face a two sided challenge:-
- they are reputedly owed c. £900m by Carillion, and they won’t have asset security for all of that.
- many smaller customers will now face real cash flow problems resulting from unpaid Carillion debts, which means the Banks will be nervous that they may lose more money!
Smaller companies need to be armed and ready to manage their Banking Relationships and facilities so that they are not squeezed out of existence by implication (and this is definitely a risk).
Helpfully this is where Glenville Walker Consulting’s Banking Review team can help. There are ways in which Carillion debts can be ring fenced so that they don’t stop other trading from being negatively impacted. The Banking Review team also works closely with a specialist group of Accountants who can help with “rescue” packages and structures.
So, if you are potentially affected by Carillion, please contact Hazel Walker, Commercial Relationship Manager on 0151 305 9654 or firstname.lastname@example.org to see how the Banking Review team at Glenville Walker Consulting can help.