Jessica Fino 16 Apr 2018 11:36am

Carillion collapsed with £7bn in liabilities

The construction company had nearly £7bn in liabilities when it collapsed in January this year, according to reports

In a letter to creditors, the official receiver David Chapman wrote that Carillion had an estimated £6,905,532,000 when it entered liquidation, rather than the £5bn previously reported, according to Construction News.

Chapman reportedly said that this early estimate is highly likely to change, “As more certainty surrounding where liabilities lie and true liability for pension schemes in deficit become known”.

An Official Receiver spokesperson said, “We can confirm that the official receiver has produced reports detailing the current understanding of the financial position of the companies that are in liquidation.

“This position is expected to change significantly as assets and debts are fully identified and assigned to individual companies within the group structure.

“The reports will assist Carillion’s creditors to assess their eligibility for bad debt relief.”

The spokesperson added the £7bn figure reported relates to Carillion Construction Ltd, which was the main entity undertaking construction activities. The Carillion Group was formed of 326 companies globally - 27 of its UK based entities are currently in liquidation.

PwC partners said last month it had already charged £20.4m for its administration work at Carillion over the first eight weeks.

MPs have previously accused all the Big Four firms of “feasting” on Carillion, after it was revealed the firms received a combined total of £71.6m in fees.