Irish construction group Lagan has put four of its companies into administration, with up to 200 employees likely to be at risk.

The affected businesses are Lagan Construction Group Holdings, Lagan Construction Group, Lagan Building Contractors and Lagan Water.

Lagan chairman Michael Lagan said that these parts of the group had been significantly impacted upon by a number of factors within the civils and building divisions.

These include delays in the commencement of new projects, protracted contractual disputes on some existing major projects and instability caused by a joint venture partner in Britain.

The news has implications for – among other contracts – a Highways England scheme to improve the A19/A1058 Coast Road in the North East, which includes construction of a triple decker roundabout.

The scheme was being delivered in a joint venture with Sisk. Highways England said there are contingencies in place to ensure no delay to the project. 

“Work is continuing as normal on the A19 Coast Road scheme which remains on track to be completed by the end of March 2019 as scheduled,” a spokesperson for Highways England said.

Lagan had also worked alongside Ferrovial to deliver the construction element of an upgrade to Scotland’s A8, M8, M73 and M74 near Glasgow. The project completed last year at a reported loss for the contractors.

Commenting on the four businesses going into administration, a senior contracting source told TP Weekly News that, unlike the fall of Carillion, “this seems to have come completely out of the blue”.

The source added that recent events are not expected to spark a major trend of civil engineering firms going under. “There is potentially a very good market as we go forward, with continuing investment in infrastructure. Those companies that maintain a good balanced portfolio of income generating work, and which show good financial management, should remain stable.”

Lagan’s remaining 26 companies are not currently thought to have been impacted. Michael Lagan added: “It is with great sadness and reluctance that we have had to take this course of action. We have had long standing relationships with many sub-contractors and suppliers. We hope that the process of administration will be smooth and that disruption to both projects and jobs will be minimal.”

Image: Highways England