Statement from Carillion says it is looking for short-term financing
UK construction and engineering services giant Carillion saw it shares fall to 14p and the value of the company slip to £86 million ($118 million) at the end of trading on the London Stock Exchange amid talks with its creditors to see how the company can continue to finance its operation and debt of $1,09 billion. Reports in the UK, suggest consultancy firm EY is on standby should the talks on Carillion’s ability to finance the debt and an additional pension shortfall of $800 million stall.
Carillion is a major government contractor in the UK but is also prominent in a number of other markets, including the Middle East and Canada. Its international contracting arm Carillion Construction Overseas Limited owns a 49% share in Al Futtaim Carillion.
A statement received by meconstruction news from the company said the following: “Carillion met with representatives of its creditor groups to present its business plan on 10 January 2018. Further to this presentation, Carillion continues to engage in constructive discussions with a range of financial and other stakeholders regarding options to reduce debt and strengthen the Group’s balance sheet. Suggestions that Carillion’s business plan has been rejected by stakeholders are incorrect.
“It is too early to predict the outcome of these discussions but Carillion expects that any such agreement is likely to involve the raising of new capital and the conversion of existing financial indebtedness to equity which would result in significant dilution to existing shareholders. As part of its engagement with stakeholders, Carillion is in constructive dialogue in relation to additional short term financing while the longer term discussions are continuing.
“The Board remains focused on seeking to deliver an outcome that will ensure that the Group emerges considerably strengthened and able to continue delivering excellent service to its many public and private sector customers.”