ISG’s Collapse and the Road to Recovery
Within 100 days of ISG’s collapse, Alliance Leisure had every affected project back on track. MD, Paul Cluett, reflects on how Alliance navigated the challenges, the lessons learned and the power of relationships and collaboration.
Managing Director
When ISG Construction went into administration on September 20, 2024, in addition to all the employees and sub-contractors who lost their jobs and income on that day, the potential impact on our clients and their committed build projects was immediate and profound. ISG was the principal contractor on several major leisure development projects, being delivered by Alliance Leisure through the UK Leisure Framework, and representing approximately £250 million worth of investment. Overnight, these projects faced the threat of significant delays or even cancellation, triggering an urgent and comprehensive response from Alliance Leisure.
Reflecting on the past four months, I am immensely proud of how our team and our network of professional advisors rose to the challenge. Their resilience, resourcefulness and commitment ensured we found effective solutions to keep projects moving forward. Within just 100 days of ISG’s collapse, every affected project was back on track, reaffirming our position as a trusted partner in the construction and leisure sectors.
Immediate Response
Our first priority was to stabilise the situation. With projects in various stages of development, we needed to act quickly to secure all sites and took specialist advice to ensure the legal and financial positions of our clients were protected. This initial phase was all about gaining clarity amidst uncertainty. Our teams moved swiftly to assess the impact on live projects and those in pre-construction, engaging closely with clients to understand their concerns and outline a clear path forward.
Simultaneously, we began engaging with alternative contractors. This rapid mobilisation was possible thanks to our established relationships and the robust mechanisms of the UK Leisure Framework, which is managed by Denbighshire Leisure Limited (DLL) and allowed us to respond quickly and effectively. Our goal was to minimise delays and cost escalations, ensuring continuity and confidence for all stakeholders.
As a relatively small business, we are more agile than larger organisations. Our team were just fantastic. During those first few weeks, we met most evenings to report on the latest updates and set the following day’s actions. I felt like a conductor of an orchestra, I was just directing our immensely talented team and knowing that I could trust each individual to deliver. I didn’t have to ask twice; we were all on the same page and in harmony, which is what got us through. The experience was both challenging and exhilarating, but not one that I would want to repeat again.
When we first heard the news about the ISG fallout, it was a shock. We were concerned about the potential impact on the Clay Cross project and the community. Sarah Watts from Alliance Leisure personally rang me to inform me of the situation, which left us with many questions about the next steps. It was a time for cool heads and professional advice.
Alliance Leisure’s response was swift and reassuring. They immediately provided professional advice and leveraged their extensive supply chain and framework partners to address the situation. During those early days, their clear communication and proactive approach were invaluable. They kept us informed at every stage and quickly appointed new contractors to ensure the project stayed on track. It was everything you could wish for from a true partnership.
Now, looking back, we feel confident about the progress made. Alliance Leisure’s handling of the situation has been exemplary. Their commitment to getting the site back up and running, coupled with their transparent communication and rapid response, truly stood out. We are grateful for their support and professionalism during this challenging time.
Matt Broughton, Director – Growth & Assets, North East Derbyshire District Council
Tackling Live Projects
The live projects presented the most immediate challenges. Each site was in a different state of progress, and the sudden exit of ISG left behind an operational tangle that required meticulous unpicking. Our team undertook detailed reviews of each project to understand their exact status and scope, working closely with clients to keep them informed and reassured throughout.
Leveraging the UK Leisure Framework, we engaged alternative contractors to develop Contractor Proposals (CPs) for each project. These CPs formed the basis for new contracts, allowing work to resume without unnecessary delay. This phase was complex and demanding, but our team’s dedication ensured that every project moved forward efficiently in alignment with our clients’ objectives.
The Council was shocked when the news broke as the project was progressing well, so the news regarding ISG was unexpected. We felt deeply sorry for the staff and any subcontractors affected.
Alliance immediately provided stability and support with regular, solid, reliable updates in what was a very fast-moving situation that needed to be matched by effective decision-making by the Council. Important aspects such as site security were put in place immediately by Alliance to protect the assets on site.
Key staff and very senior managers at Alliance made several calls to reinforce their commitment to the Council, offering their support and expertise to get us through this unexpected and exceptional stage in the project. We are very grateful to Alliance for their support, expertise, and quick action to engage with potential replacement contractors, which has meant we are back on site after only a few months of the site closing. Regular, clear communication matched with expertise, calmness, honesty, and dependable advice and support from all at Alliance, particularly from Tom Gardner and James Foley, meant that the Council was able to make its own decisions in a timely and informed manner. We could not have asked for a better partner.
Councillor Munsif Dad, Leader of Hyndburn Borough Council
The Power Of Collaboration
The success of this recovery is due to collaboration at every level. Internally, our teams worked tirelessly, pooling expertise and resources to deliver effective solutions under pressure. Externally, we relied on the strength of our partnerships with contractors, consultants and of course, our clients. Their trust and cooperation enabled us to implement solutions quickly and effectively. Open and transparent communication was key, ensuring that everyone involved had a clear understanding of the steps being taken and the outcomes we were working towards. The UK Leisure Framework also proved invaluable, providing a flexible yet robust platform that allowed us to navigate the complexities of the situation with confidence and agility.
When we heard the news there was the initial shock and worry about what would happen, our immediate thoughts were cashflow – what about the money ISG owed us for works complete? Forecast work – what about projects we had secured and committed resource to? Future projects – what will happen to these if the focus is on recovering the onsite projects which ISG has left part way through? Workload – what does this mean, especially short term? Do we have enough work for our team?
After some sleepless nights and hours on the phone, we started to realise that our partnership with Alliance Leisure, and strong relationships with individuals and businesses within the sector, would provide some comfort. Some of the phone calls I received in the aftermath of ISG were very humbling, offers of support both short and long term which certainly started to give us confidence for the future.
As the short-term realisation and plan started to come together, thanks to the positive reaction and great communication from the Alliance team, we could start to look at the recovery of our work within the leisure section. We have strong working relationships with a number of the main contractors that work with Alliance and their workload was going to increase which is a positive for us as we could start to build those relationships further. Also, there were post after post on LinkedIn with former ISG employees securing new roles in other businesses, some we had existing relationships with and some we didn’t, there was an opportunity to expand our client base and network with these companies and even now, after only a few months, enquiries and relationships are forming.
Although this was something that no one wanted, what this situation cemented is our partnership with Alliance Leisure. Their positivity and commitment to ensuring that the projects and partners on the UK Leisure Framework come through this period has been unwavering and comforting. Alliance is definitely a client that have your back and are in your corner fighting for you. We are very much looking forward to the future and a strong pipeline for new projects.
Dave Parker, Director, CGP MEP
Key Learnings
The experience of managing the fallout from ISG’s collapse has reinforced several core principles for Alliance Leisure. First and foremost, it highlighted the importance of adaptability. The construction landscape is inherently unpredictable, but by staying agile and solution-focused, we can continue to deliver for our clients, even in the face of significant disruption.
It has also reinforced the importance of relationships. I firmly believe you reap what you sow. The relationships we have built with clients and partners over the years paid dividends. It was especially rewarding to see Sport England supporting affected schemes by providing additional funding to help ensure committed projects remained viable. People could see we were working exceptionally hard to achieve the best outcomes for all involved. They were understanding, supportive and despite everyone feeling some degree of pain during this experience, they were prepared to dust themselves off and stand shoulder to shoulder with us.
The experience also reaffirmed the value of the UK Leisure Framework as a tool for resilience. It allowed us to respond quickly, secure alternative contractors and maintain project momentum, ensuring that our clients’ objectives remained achievable.
Finally, it underscored the strength of our team. The professionalism, dedication and expertise displayed by everyone involved were nothing short of remarkable. Their efforts not only mitigated the immediate impacts of ISG’s collapse but also strengthened our processes and partnerships for the future.
The Outcomes
Despite the challenges, the outcome has been overwhelmingly positive. Within 100 days, all Alliance driven ISG projects were back on track, with minimal cost increases and disruption to timelines. This is testament to the effectiveness of our approach and the resilience of our team. It’s also a powerful demonstration of what Alliance Leisure stands for: unwavering commitment to our clients and a determination to deliver exceptional results, no matter the circumstances.
As we move forward, we remain focused on completing these projects to the highest standards, ensuring they deliver long-term value for our clients and their communities. The lessons learned from this experience will continue to inform our work, helping us to navigate future challenges with confidence and clarity.
I am also very pleased that many of the ISG employees and sub-contractors that we have worked with over the years have found new roles with main contractors delivering Alliance leisure projects.
To our clients and partners, thank you for your trust and collaboration during this challenging time. Together, we have turned a potential crisis into a story of success and resilience – one that reinforces our shared commitment to excellence in the leisure and construction sectors.