Banks must show leniency to Carillion's SME supply chain, says FMB


Interserve, a rival of Carillion until its financial collapse this week, has seen its share price fall sharply on a report the Government is closely monitoring the company.

Infrastructure firm Carillion collapsed on Monday when its banks pulled the plug, leaving the government to step in to guarantee public serviced provided by the company ranging from school meals to roadworks.

"We do not believe that any of our strategic suppliers are in a comparable position to Carillion".

Interserve, like the Government, sought to distance itself from the collapse of Carillion.

Brian Berry, Chief Executive, said: "It's absolutely critical that the banks give the innocent victims in Carillion's supply chain as much leeway as possible in the short to medium term".

Interserve, which employs around 80,000 people worldwide, said it was updating the government on the company's progress with its turnaround plan.

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Interserve has facilities management contracts with numerous government departments, including the U.K. Cabinet Office, and also cleans the London Underground rail network.

Interserve issued a profit warning in September, saying it was set to make huge losses on an energy-from-waste contract in Scotland.

Britain's second largest construction firm, which employs 20,000 people in the United Kingdom, went into liquidation on January 15 with debts of around £1.5bn.

Its policy manager Alan Welsh said: "The collapse of Carillion raises a number of questions not least of which is the conduct of previous and current directors of Carillion, as well decisions to continue awarding major public sector contracts to an organisation in clear financial distress".

Interserve, which has around 80,000 staff worldwide - 25,000 of them in the United Kingdom - saw its chief executive quit in the past year ahead of a profit warning last September which left shares losing more than half their value. The company employs 43,000 staff globally, 20,000 of which are based in the United Kingdom, where most of its business is focused, including construction workers, hospital cleaners, and energy and utility personnel.