Carillion agrees £50m disposal to Serco, announces new financing
Carillion said it has agreed to sell a large part of its UK healthcare facilities management business to Serco for £50.1m, as it announced new financing and contract wins.
In an update on Tuesday, the facilities management and construction services group said it has agreed to give Serco a period of exclusivity to provide the parties with time to finalise a business purchase agreement, with both parties aiming to sign in the next few weeks.
The company also said it plans to dispose of the remaining contracts in its UK healthcare facilities management portfolio next year. In addition, while it continues to pursue the disposal of its Canadian businesses, it is also evaluating whether it might be better to retain some of those businesses.
Carillion has secured improved credit facilities of between £170m and £190m for 2018 through a combination of new facilities and deferrals. Meanwhile, talks with lenders and shareholders are ongoing regarding about options for a capital restructure.
The group also highlighted recent contract wins, which include a £200m contract with ultrafast pure fibre broadband company Gigaclear, a £105m contract with Emaar Properties and a £71m contract with the University of Manchester to design and build Phase 1 of its Fallowfield Student Residences project.
Interim chief executive Keith Cochrane said: "Today we are announcing progress on a number of fronts and whilst our customers and creditors continue to be supportive, much remains to be done.
“We remain focused on executing our disposals and cost savings programmes while continuing our discussions with our lenders and other stakeholders to explore further ways of strengthening Carillion's balance sheet."
At 0806 BST, the shares were up 22% to 53.20p.