Carillion secures two government facilities management deals worth £158m

carillion signTroubled infrastructure firm Carillion has been selected to deliver facilities management services at hundreds of military sites across the north of England, Scotland and Northern Ireland.

With a core revenue value of £158 million over the initial contract period of five years, but with the opportunity to double that figure in the same period through catering and retail sales, the two new contracts will see the Carillion Joint Venture deliver services including catering, retail and leisure, together with hotel and mess services.

These latest contracts follow on from the award of the South East and London contract by Defence Infrastructure Organisation (DIO) to the Joint Venture earlier this year.

The North contract will employ around 1500 people, covering 130 military establishments and will go live at the beginning of January 2018.

The Scotland and Northern Ireland Region contract will go live at the beginning of November 2017 and covers a further 103 military establishments and will employ around 1030 people.

Carillion interim chief executive, Keith Cochrane, said: “We are delighted to be awarded these contracts. The DIO is a key support services customer with whom we have built a long-term successful partnership. We are committed to building on this relationship and on our position as a leading supplier to the DIO by using our core skills and capabilities to deliver high-quality services.

“These contracts play a critical role in supporting our armed forces and they have a number of unique aspects that require a specific, regional focus. They will enable us to create further training and employment opportunities for ex-services personnel in support of our commitment to the Armed Forces Corporate Covenant.”

Last week Carillion continued a troubled spell after it issued a profit warning with chief executive Richard Howson stepping down with immediate effect.

Shares in Carillion fell over 35% following the announcement as the firm said it would need to bolster its balance sheet and was struggling to stay within borrowing limits.

The company has now drafted in accountancy giant EY to help carry out a review of the business.

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