Scotland's richest businessman, Sir Tom Hunter, and beleaguered banking group HBOS could be among the big losers as retirement home developer McCarthy & Stone scrambles for future funding amid the tightening stranglehold of the credit squeeze.

McCarthy & Stone, one of the UK's largest property companies, has found itself in a vice grip between the decreasing value of assets in a property market gone south and the increasing difficulty of getting its hands on cash.

In recent years, the Bank of Scotland Corporate Business committed huge sums by providing both debt and equity funding for investments in housebuilders, such as McCarthy & Stone, some of which were completed along with Hunter at or near the top of the market for around £1.1bn.

Hunter owns an 8% stake in the retirement home specialist and HBOS holds a 20% stake.

The credit squeeze at McCarthy & Stone has been exacerbated because its main financial backers were HBOS, now to be acquired in a government-engineered rescue takeover by Lloyds TSB, and Lehman Brothers, the US bank which collapsed last month.

Industry sources told The Herald that concern is rife among McCarthy & Stone's largest backers about what "Lloyds TSB will do with some of HBOS's bigger investments".

One sources said: "There is no question that, given the property meltdown and the liquidity crisis, some sort of debt restructuring is needed."

HBOS yesterday declined to comment.

A spokesman for Hunter said: "Our position is one of a long-term investor.

McCarthy & Stone is a modest part of our portfolio, but like other investors in housebuilding industry, we are concerned."

HBOS and Hunter own stakes in Crest Nicholson, where values have also reportedly fallen sharply recently.

Meanwhile, it emerged over the weekend that a dispute has erupted between McCarthy & Stone's creditors and shareholders over how best to resolve mounting funding fears at the housebuilder.

The debt holders are understood to have hired specialist restructuring firm Houlihan Lokey to advise them.

The firm's other share- holders include David and Simon Reuben, the real estate billionaires who are also understood to own a large chunk of the debt, property developer Nick Leslau, and Richard Desmond, owner of the Daily Express.

A board meeting of McCarthy & Stone is understood to have taken place on Friday, although it was unclear yesterday whether any progress was made on debt restructuring.