The crisis at Carillion deepened on Friday after reports that lenders had effectively rejected a rescue plan and that two of the Big Four accountancy firms were preparing to act as administrators.
It said the firm remained in constructive dialogue about short term financing while "longer term discussions are continuing".
Any agreement was likely to involve the raising of new capital and the conversion of existing debt to equity, which would result in "significant dilution to existing shareholders", it said in a statement.
The government, the Pensions Regulator and representatives from the firm held crunch talks to discuss the firm's options on Friday. It employs 43,000 people globally.
Aside from its construction business the company has many outsourced public sector contracts in health, education, the prison service and local authorities.
In July past year it won contracts to build Britain's new High Speed 2 rail line, a key project that will better connect London with the north of England.
A spokeswoman for the government declined to comment to the BBC on any specific meetings.
The Guardian's website reported shadow business secretary, Rebecca Long-Bailey, as saying: "The collapse of Carillion could provoke a serious crisis".
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He added that workers "should have protection and guarantees from the government, including an assurance that operations will be directly transferred over to Network Rail with all jobs, pensions and rights safeguarded if Carillion goes bust".
A Government spokeswoman said: "Carillion is a major supplier to the Government with a number of long-term contracts".
Senior Cabinet ministers thought to include Business Secretary Greg Clark, Transport Minister Jo Johnson and Justice Minister Rory Stewart, were called to a meeting on Thursday to discuss Carillion's future, in a sign that the Government is preparing for the outsourcer's collapse after revealing earlier this week that it had drawn up contingency plans.
Carillion is a major supplier to the UK Government and key contractor in the first phase of building the £56bn HS2 rail line.
"We are committed to maintaining a healthy supplier market and work closely with our key suppliers".
The company is fighting net debts of more than £900 million, following a crisis sparked in July past year when it issued a profit warning.
A spokesperson for the Pensions Regulator said the organisation remained "closely involved" in discussions with Carillion and the trustees of its pension schemes.
A Scottish Government spokesman said: "We continue to liaise with UK Government colleagues to monitor and mitigate service risks associated with Carillion's financial situation and stand ready to offer what assistance we can at this anxious time for the company's employees and their families". "It would be inappropriate for us to comment on any individual contractor's internal financial governance".