TROUBLED support services group Carillion saw shares recover by 20 per cent yesterday, after its joint venture partnership was awarded £1.4 billion worth of contracts to build the HS2 high-speed rail line.
The CEK joint venture partnership, consisting of Carillion, French group Eiffage and UK company Kier, won two contracts worth £724 million and £616m.
The contracts will have two stages: the first is a 16-month stage to develop a design, a programme and a target cost for the construction of the works. Stage two is the construction of the main works on the portions of track included in the contract. This is expected to take between up to five years to complete. The announcement comes a week after Carillion’s share price collapsed by 70 per cent following a profit warning and the departure of its chief executive.
Keith Cochrane, the former Weir Group chief executive who took over as Carillion interim chief executive last week, said “We are delighted that CEK has been selected to deliver two of the three Central contracts for HS2 Phase 1, the London to Birmingham section of the route, reflecting the strength of our joint venture.”
Separately, Carillion has appointed EY to support its strategic review, with a particular focus upon cost reduction and cash collection.
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