Carillion shares surge on takeover bid rumours

Aaron Morby 1 year ago
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Shares in Carillion surged on Wednesday after a report that a Middle Eastern firm is preparing a possible takeover bid.

The report saw Carillion shares climb 20% from around 46p to 57p during the day.

According to London’s City AM newspaper, the bidder plans to submit a letter of intent to take control of the company but is waiting to see the extent of its financial woes before committing to a bid.

The bid rumours is not related to plans by Carillion to offload its Middle East business as part of a radical cost-cutting and fund raising plan to sell its overseas operations.

Carillion is due to publish delayed half-year results on Friday, which are expected to reveal the full extent of the contracting group’s woes.

The partial extent of Carillion’s problems were first revealed by the firm in July when it unveiled a £845m writedown due to problem contracts sending its shares then valued at 192p into freefall.

Carillion is also saddled with a pension deficit of £650m, more than three times its current £200m market capitalisation.

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