6 February 2018 | Herpreet Kaur Grewal
The former chairman of support services company Carillion, which collapsed last month, has told a panel of influential MPs that its debt level was partly due to a major acquisition the firm undertook in 2011.
Phillip Green CBE, chairman of the company, told the Business, Energy and Industrial Strategy Committee and Work and Pensions Committee in Parliament, that three main reasons led to the failure of the construction and FM firm including a major acquisition, four major contracts starting to fail in 2017, and the failure to get a funding deal from banks and government in 2018.
In 2011 FM World reported on Carillion's acquisition of suppliers of heating and renewable energy services, Eaga - likely to be the one to which Green is referring - whose share price "took something of a hit [in 2010] as government cuts hampered its business, especially the delivery of the Warm Front programme".
Green said he took "full responsibility" for the company's collapse and was "very, very sorry".
Earlier, Zafar Khan, the former finance director of Carillion, said: "The pension deficit had grown because we weren't putting in a sufficient level of funding."
Former Carillion CEO Keith Cochrane said the business asked the government for £160m of funding over four months, which they believed could save the company long term, but it was denied. Both Cochrane and Richard Howson, former chief executive, said they had not got the payment on a £200m World Cup 2022 contract.
Former Carillion FCO Emma Mercer denied the company was a habitually late payer that made suppliers wait 120 days, putting them in peril.
The inquiry continues.