The Hurstwood Group is preparing to place its external contracting division Hurstwood Construction into administration, citing problems at B&R's Howard Town Mill, Glossop.
Hurstwood and B&R both issued statements today seemingly blaming the other for the situation.
The initial statement, issued by Hurstwood Construction, said: "[We have] been trying to resolve issues over funds at one particular project in Glossop for several weeks but finally took the decision to call in the administrators this week.
"Insolvency practitioners Begbies Traynor have now been appointed by Hurstwood Construction to handle the administration process.
"The Hurstwood Group's commercial, investment and development, house-building and land trading operations will be unaffected by this decision, and the company says it will do everything in its power to keep job losses to an absolute minimum."
The counter statement from B&R responded: "It is a huge disappointment to learn that the Hurstwood Group has apparently applied to put its construction business into administration. B&R Developments is particularly saddened for the situation that this move puts numerous sub-contractors and B&R in.
"B&R Developments did everything in its power to assist Hurstwood Construction in its attempt to avoid getting into financial difficulty. We can confirm that no further monies were due to the company under the current contract. Payment of monies due under the Contract from B&R to Hurstwood Construction were made in full and on time and in accordance with the Contract. We therefore cannot see how payment issues under this contract could have caused the demise of Hurstwood Construction (renamed as Initial Construction UK Ltd (19/05/08)).
"We are pleased to announce that B&R Developments has taken back the formal control of the Howard Town Mill site due to Hurstwood Construction's failure to proceed with works (a process which we started two weeks ago). We remain fully committed to making the project a success and plans are in place to complete the development with the new project management team, completing the first phase within a matter of weeks and finishing the entire project within weeks of the most recent Hurstwood programme."
Hurstwood Group commercial director, Dominic Fussell, added: "This is a regrettable but necessary decision and it was only taken after we had exhausted all the other possibilities. We have fought day and night for several weeks to stave off this situation but we were left with no other choice when we recently received a winding up petition from a sub-contractor.
"The company has significant outstanding debts owed to it which could have made a difference, but unfortunately time ran out for us when we received the petition. We have worked tirelessly and spent a lot of money trying to save the business and the biggest creditor by far will be the Hurstwood Group.
"This scenario is the last thing we wanted for our workforce, our sub-contractors and our clients. However, our hands were tied."
Hurstwood Construction was established four years ago to work on external contracts.