The £38m-turnover firm has proposed a company voluntary arrangement that will see it pay creditors a percentage of every pound owed.
If the deal is not accepted by 75 per cent of creditors, the firm will be placed into administration, it said.
William Anelay currently employs 190 staff and has been in operation since 1747.
According to credit agent Top Service, the York-based company owes 22 firms a total of £200,000, with five of the creditors issuing debt recovery orders with the agency.
The company, which specialises in historic construction and heritage restoration, said it entered financial difficulties after a period of expansion, which saw it take on projects outside its traditional scope of work.
During this time, the company took on a number of problem contracts and was unable to pay suppliers, it said.
According to Top Service, the majority of outstanding payments have been longer than 120 days.
The firm’s associated businesses – Lowery Roofing, Hare and Ransome Joinery, Anelay Traditional Masonry, and Anelay Building and Conservation – are unaffected by the CVA and will continue to trade as normal.
William Anelay chief executive Charles Anelay said all but one of the problem projects had completed and the company had a strong order book for the next 12 months.
The firm has a secured workload of £33m, with £9m-worth of projects under consideration for the end of this financial year.
Mr Anelay said: “While only a few projects outside our usual sphere have been involved, the values were significant and this has harmed our business performance and cashflow.
”They are now finished, save one, where completion is imminent, and another, which has been brought under control, but unfortunately we are now unable to pay suppliers.
“We have a fresh approach, have returned to our core operations and have a strong order book for the next 12 months and beyond.”
He added: “We appreciate that the need for a CVA will be a great disappointment to subcontractors and suppliers who have supported us for many years, but this is the best way to make a maximum and prompt return to creditors and we are totally committed to making it a success.
“Of course, it can work only if our customers are prepared to support the proposal as well.
“With our bank’s support and a successful completion of the proposed debt restructuring, we aim to continue in our current form and are committed to completing schemes under contract.”