GIVEN the huge experience he has acquired leading some of Scotland’s biggest businesses, Keith Cochrane may be a good person to help steady the ship at Carillion.
The Wolverhampton-based construction and facilities management combine has launched a comprehensive review after missing its debt reduction targets in the first half when it became clear all was not well at the group.
Highlighting the challenges it has faced in areas such as Canada and the Middle East, Carillion held out the prospect it will withdraw from some markets and sell off what are deemed to be non-core assets.
After running Weir Group and Stagecoach with a spell as finance director of Scottish Power, Mr Cochrane knows plenty about the challenges involved in maximising returns from international businesses.
But his skills may be most in demand in the UK where Carillion said it is facing problems on three big public private partnership projects. These are thought to include the £745 million Aberdeen bypass, which Carillion is building with two other firms.
The company said KPMG had found serious weaknesses in its approach to completing such contracts, including what looks like wishful thinking about the likely outcomes.
The news Carillion’s profits on some PPP contracts may be much lower than expected could please those who feel the controversial programme has been too generous to private sector players.
However, with Carillion deciding to withdraw from the market to build PPP projects, the prospects of ministers squeezing better terms from the remaining competition may have got slimmer.
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