Troubled Carillion wins HS2 building contract

Elias Hubbard
July 17, 2017

The company, which last week lost three-quarters of its share price following a profit warning, was awarded two contracts to build the the North Portal Chiltern tunnels to Brackle, along with Eiffage Genie Civil, Kier Infrastructure and Overseas Ltd.

MPs have already passed the law paving the way for phase one of the HS2 project from London to Birmingham and Mr Grayling will soon publish a bill to deliver the next phase from the Midlands to Crewe.

Only five UK-owned firms, including troubled Carillion, are among the nine making up consortiums appointed today to build bridges, tunnels, embankments and viaducts.

The seven companies to win contracts also included Emirates and Olympic stadium builder Sir Robert McAlpine, Balfour Beatty and France's Vinci.

Transport Secretary Chris Grayling said: "This is a hugely important step in the construction of Britain's new railway and underlines this government's determination to deliver an economy that works for all".

He said: "Obviously in the light of last Monday's announcement by Carillion, HS2 has carried out additional due diligence and sought re-assurance of both it and its two partners in the joint venture - Kier and Eiffage - that they remained committed and able to deliver the contract".

The work includes the North Portal Chiltern Tunnels to Brackley, worth £724m, and the Brackley to Long Itchington Wood Green Tunnel South Portal, worth £616m.

Mr Cochrane confirmed in a separate announcement that professional services EY was being brought in to "bring an external perspective to our cost reduction and cash collection challenge".

In early trading, Carillion shares topped the FTSE 250 leader board, bouncing 8%, or 4.55p higher to 60.70p, while Balfour shares gained 2.5%, or 6.5p at 269.4p.

Ministers suggested in November previous year that the line should serve the existing Sheffield city centre station, after proposals to run trains to the Meadowhall shopping centre were shelved.

He is also set to confirm the final route of the Manchester and Leeds arms of the high-speed railway.

He is expected to bring forward the planned completion date for the next phase from the West Midlands to the West Coast Mainline from 2033 to 2027.

Campaigners have called for the original route to be backed, with residents on Mexborough's Shimmer estate protesting that the so-called "M18 route" will go through their homes or pass within yards. HS2 is a real opportunity for British steel to shine.

The new stations are expected to create more than 170,000 new jobs as part of wider area development and will serve to connect tens of thousands of passengers every day.

Opponents of the £55.7 billion project claim it will run over budget, create havoc during construction and have disastrous environmental consequences.

Other reports by Click Lancashire

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