Carillion sells more assets
Carillion, which is continuing to shore up its balance sheet, today announced the sale of more of its assets.
It is raising £13.8 million by selling its 66.67 per cent shareholding in Ask Real Estate (AREL), and a shareholder loan made by Carillion Construction to AREL’s subsidiary, Ask Central and a 50 per cent interest in Ask Carillion Developments to one or more wholly-owned subsidiaries of Dukehill, which is a £60.8m-turnover company that specialises in commercial and residential property development and is based at Oldbury and owned by the Richardson family.
A total of £1m of the cash consideration is dependent on the sale of 100 Embankment in Salford, which will be paid by Dukehill within five business days of signing the sale documentation.
AREL and ACD carry out commercial property development activities, together with partners, in the north of the UK, including Manchester, Liverpool and Leeds.
For the 2016 financial year, the interests that are the subject of the sale contributed £4.1m of revenue and£11.6m pre-tax profit to the Wolverhampton-based construction and support services group.
The sale is expected to generate a modest profit on disposal, and the interests being sold were not expected to make a material contribution to overall group profit for 2017.
AREL managing director John Hughes and finance director Jonathan Cross, who together own 33.33 pe cent of AREL, will retain their executive positions.
Carillion's interim chief executive Keith Cochrane said: "We are pleased to be able to announce further progress. Much remains to be done, and we are continuing to execute our plans to refocus the business, reduce cost and strengthen our balance sheet."
Last week Carillion appointed a new chief executive Andrew Davies, curently chief executive of Wates Group, to lead its turn around. He will start on April 2.
Shares in the Wolverhampton-based business plunged after it suffered a £1.15 billion half-year loss after revealing major problems with construction projects at home and in the Middle East.
Also last week Carillion agreed to sell a large part of its UK healthcare facilities management business to Serco Group for £50.1 million and up to £190m of new funding. It also announced the winning of three major new contracts in the UK and Dubai.
