Troubled Carillion to help build HS2
Troubled construction giant Carillion is among the firms awarded contracts for the building of phase one of the HS2 high-speed rail line.
The government contracts are worth £6.6 billion in total and will see tunnels, embankments and viaducts constructed between London and Birmingham.
The work is estimated to support 16,000 jobs.
A partnership featuring Carillion has been commissioned for two projects.
The firm’s share price tanked by more than 70% last week after a profit warning and an £845 million write-off on construction contracts.
However, its stock rose by more than a fifth in morning trading yesterday after a double boost from the HS2 rail contract and an agreement with EY to help support its major business review.
Interim chief executive Keith Cochrane, who has previously led Stagecoach and Weir Group, said: “Alongside our own efforts, EY will provide support across the business and bring an external perspective to our cost reduction and cash collection challenge.
“My priorities are to reduce the group’s net debt and create a balance sheet that will support Carillion going forward.
“We need to simplify the business and demonstrate that value can again be created for shareholders.”
Balfour Beatty and joint venture partner VINCI have also picked up two HS2 contracts worth around £2.5bn while a number of foreign firms including Sweden’s Skanska, French company Bouygues Travaux and Austria’s Strabag also picked up new work. High-speed trains are expected to begin operating between London and Birmingham in 2026.
A concept image of how part of the HS2 route between London and Birmingham will look.