Banner Holdings in administration

Banner Holdings, the contractor behind the troubled Rafael Vinoly-designed Colchester Arts Centre, has gone into administration.

A spokesmperson for administrator Bell Advisory said the collapse of the £12m-turnover Derbyshire-based firm had been caused by a “number of funding issues”.

The company employed 28 staff, down from 64 three years ago, all of whom have lost their jobs.

Banner and Colchester council had been in a legal row over the arts centre since the end of 2007, when a string of disputes began over technical issues, including the design of the guttering.

According to Peter Elston, chief executive, the disagreement cost the company up to £4m in 2008. Banner had submitted “a sizeable claim”, which was believed to be in the millions, for money it says it was owed.

The row was the most high-profile of four problem jobs at Banner last year. The others were a commercial scheme in Sheffield, a private care home deal in Nottingham and a row over contract extension payments on a job for Winchester and Eastleigh NHS Trust. As a result of the disputes, turnover fell from £23.9m to £10.3m.

The £3.5m Sheffield scheme had the biggest impact on the bottom line and cost the company £2.7m in profit after the client, Steenburg Property, went into administration. The job was also plagued by rows about time extensions and additional costs. “We were quite miffed about the way the client treated us, to put it mildly,” Elston said at the time.

The collapse of Banner follows a string of other high-profile failures including Verry Construction and Lancsville.

The Bell Advisory spokesman said a number of firms had expressed an interest in acquiring some of Banner’s contracts although it was unlikely to be sold as a whole.

There is no connection between Banner Holdings and Banner Homes Group, the Buckinghamshire based private housebuilder.