The companies that filed late notices on Thursday afternoon include ISG Construction Limited, ISG Engineering Services Limited, ISG Retail Limited, ISG UK Retail Limited, ISG Jackson Limited, and ISG Central Services Limited. Reports Contract Journal
Notably, ISG Fitout Limited, which posted a £24 million profit and generated over £500 million in its last reported accounts, has not been involved in the court proceedings.
On Thursday, confusion swept across multiple sites as industry rumors suggested ISG’s financial troubles had finally reached a breaking point.Reports surfaced of subcontractors halting work on several projects due to fears they wouldn’t be paid.
It remains unconfirmed which administrators will be appointed to the £2.2 billion turnover business, which employs roughly 3,000 staff, though speculation suggests Ernst & Young may take the role.
The move to appoint administrators comes just days before employees were set to receive their monthly wages on Monday.
The collapse of one of the industry’s top four contractors is expected to trigger a financial shockwave throughout the supply chain, with the mechanical and electrical (M&E) sector likely to bear the brunt of the fallout.
Concerns about ISG’s financial health first surfaced earlier this year, but the company managed to keep payments flowing within the supply chain until now.
One subcontractor told the Enquirer: “They didn’t contest payment applications like many firms do, they just missed payment runs now and again at first.”
The abrupt exits of CEO Matt Blowers and finance director Karen Booth in February reignited concerns about the company’s stability.
Subcontractors, however, were reassured that a fundamental overhaul was underway, led by a new in-house management team at the business, owned by Texan billionaire William Harrison through his Cathexis company.
Just three months ago, Cathexis attempted to dispel rumors of ISG’s ongoing financial difficulties by announcing a potential deal with an overseas buyer from South Africa. The transaction was set to inject £100 million into the company, providing much-needed capital to restore normal trading operations.
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