UK-based construction giant Carillon, which also runs recruitment firm SkyBlue, is set to enter liquidation after last-ditch rescue talks over the weekend with lenders and the government failed.

The company ran into financial difficulties last year after issuing three profit warnings in five months and wrote down more than £1 billion from the value of contracts, according to The Guardian. It also has debts of nearly £1 billion and a £600 million pension deficit.

The company has 43,000 staff worldwide with 20,000 of them in the UK. It unclear as of yet how those staff will be affected. However, the BBC reports that Carillon’s failure means that the government will have to provide funding to maintain the public services run by Carillion.

Carillion said in a statement to the London Stock Exchange: “Despite considerable efforts those discussions have not been successful, and the board of Carillion has therefore concluded that it had no choice but to take steps to enter into compulsory liquidation with immediate effect.”

"All employees should keep coming to work, you will continue to get paid. Staff that are engaged on public sector contracts still have important work to do," Cabinet Office Minister David Lidington, said.

Company executives met lenders HSBC, Barclays, Santander and Royal Bank of Scotland last week to discuss options for reducing debts, recapitalise or shoring up the group's balance sheet, but the talks failed.

In addition to its recruitment business, SkyBlue, which was formed in 2001, Carillon involved in major government projects such as HS2 as well as public services including schools, hospitals, prisons and the army.

The BBC stated that many smaller firms who work for Carillion had contacted the news outlet with concerns about whether they will be paid.

David Chapman, a civil servant working for the Insolvency Service, has been appointed liquidator of Carillion.

UK and Irish trade union Unite commented with Jim Kennedy, Unite national officer for local government, saying, "The administrator must provide reassurances on these to the workforce as a matter of urgency, and also that vital public services on which many depend will continue to be provided.”

"We will be seeking a meeting with the administrator today to press home that that the priorities now are not the shareholders but the workers who provide the service and the people relying on them. One thing is evidently clear from this: there must be no business as usual for big business.  There has to be an urgent inquiry into how a company that loaded itself with debt, which undercut competitors with unsustainable bids, which hoovered up vats of public money, and that had repeatedly alerted the government to its own financial shortcomings got its hands on so much of the public sector and taxpayers' cash,” Kennedy said. “We are also very concerned about the impact of Carillion's collapse on the wider supply chain. Many of these small firms are the lifeblood of their community but their exposure to Carillion's debt puts them at serious risk.”

Rehana Azam, the national secretary of the GMB union, also commented, “The fact such a massive government contractor like Carillion has been allowed to go into administration shows the complete failure of a system that has put our public services in the grip of shady profit-making contractors.”

“The priority now for the government and administrators is making sure kids in schools still get fed today – and our members still have jobs and pensions,” Azam said. “What’s happening with Carillion yet again shows the perils of allowing privatisation to run rampant in our schools, our hospitals and our prisons.”