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Tuesday, 5 October 2010

Construction Confidence Hits 18 Month Low

Confidence in the construction industry has hit an 18 month low as the sector mulls the forthcoming spending cuts, according to the Markit/CIPS Construction Purchasing Managers Index.

The current weakness in the housing market also weighs on sentiment in the sector.

So what can be done for struggling building companies?

In these difficult conditions even the smallest mistake culminating in a cost overrun could be critical. A business may no longer be viable going forward so the only option might be liquidation.

If a business is fundamentally sound then a company voluntary arrangement could be the answer.

One particular building company we saved had an overdraft facility of £150k with RBS. This bank is well known for blocking pre-pack administrations where the business is sold to the same directors.

So after a meeting with KSA Group a rescue plan was put together.

For details of how this building company was rescued please read our case study; CVA Rescues Building Company in the North East

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