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Carillion Liquidation

23 January 2018

Carillon went into compulsory liquidation on 15 January 2018 with PWC appointed as special managers.

The press are reporting that a major reason why Carillion failed was because they were involved in fixed price contracts at low margins.  When unforeseen problems arose on the contracts these meant that Carillion suffered substantial losses (and substantial losses were incurred on a number of large contracts).  Many of the contracts were with the Government and it seems likely that the Government will find it harder in the future to place fixed price contracts.  There was much talk in the press about contracts being much more like partnerships and it may be that contracts will be placed in the future on more realistic terms.

It is reported that Government contracts awarded since July 2017 have been joint ventures and therefore they may not be affected by the liquidation. Contracts awarded before July 2017 may now be controlled by companies in liquidation. If you or your clients worked with Carillion you should check which this is the case.

If you or your clients worked with Carillion you may be concerned as to how this situation may affect your business. We would be happy to discuss the situation in further detail.

Please contact Peter on 02380 111 366 or if you would like specific advice.