Construction giant Kier is the latest outsourcing company to raise fears after its share price bombed 33% on Friday.
It followed the announcement by the company - which lists local government among its major sectors - of plans to raise £264m to reduce its debt.
Chief executive, Haydn Mursell, said the cash injection had 'completely de-risked' the firm.
He told Building magazine that suppliers should 'look at us and see that we’re now a much stronger business. We’ve removed the shadow created by our debt position.'
The latest uncertainty follows the collapse of construction company Carillion early this year with debts of £1.5bn, leaving many local authorities to find other providers.
Last month the Government ordered outsourcing companies to draw up 'living wills' setting out how services would continue to be provided if they collapsed amid concerns over the weakness of several major firms including Capita and Interserve.
The firm’s lenders include Santander which is understood to have lost £200m on Carillion following its collapse.
