Connaught clients seek alternatives

The social housing contractor has today issued a statement to the stock market saying it ‘believes that the availability of additional funds from its lenders will not be forthcoming’ and suspending the trading of its shares.

It has said it will make another announcement shortly, prompting speculation the contractor is to go into administration.

John Morgan, chief executive of rival contractor Morgan Sindall, said around a dozen clients of Connaught have already approached his firm about whether it can step in to cover contracts.

He said: ‘Clients have been approaching us over the last few weeks, but there has been a sharp increase in the number of approaches today.’ Mr Morgan added that Morgan Sindall is in a position to take on the extra work.

Bob Holt, chairman of another rival, Mears Group, said: ‘We are watching the situation carefully and we are ready and willing to pick up work if it becomes available, we have been approached.’

Inside Housing reported last month that associations have been making emergency plans in case Connaught, which has for weeks been involved in emergency talks with creditors, should collapse.

A2 Dominion, which owns or manages 33,000 homes across London and the south, holds a 12-year service contract worth £117 million with Connaught. Its executive director Andrew Evans said last month that ‘detailed contingency plans’ had been made, but would not specify further what these involved.