Social housing contractor Connaught suspends shares

Social housing contractor Connaught is on the verge of going into administration, it has been reported.

The Exeter-headquartered business, which employs 10,000 people, today (07/09/10) requested a suspension of its shares on the London Stock Exchange with immediate effect “pending clarification of the company’s financial position”.

In its statement to the LSE, Connaught said it had agreed the terms of a short-term overdraft facility on 29 July 2010.

“Since that date Connaught has had continuing discussions with its lenders and other sources of finance with the objective of securing additional funding and a restructuring of the group's financing for the longer term,” the statement said.

It continued: “The group now believes that the availability of additional funds from its lenders will not be forthcoming and, whilst it remains in discussions with other parties, the ability to provide an adequate solution to the funding issues the group faces has become increasingly uncertain.”

Connaught said a further announcement would be made “in due course”.