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Carillion lands £500m broadband infrastructure deal

A Carillion joint venture has been awarded a £500m contract extension with BT to deliver new broadband infrastructure.

In a 60:40 joint venture, Carillion and technology services company Telent will support BT’s broadband delivery UK programme across 33 local authorities for the next three-and-a-half years.

The joint venture was first appointed preferred infrastructure services supplier by BT in 2010.

Carillion Telent will deliver civil engineering, cabling, poling and other infrastructure services to improve the UK’s broadband network and make broadband available to rural communities.

Carillion chief executive Richard Howson said the extension “reflects [Carillion’s] commitment to providing high-quality, value-for-money services and to building strong, long-term relationships with our customers”.

The deal is expected to be worth £300m to Carillion and £200m to Telent.

It came as Carillion issued a pre-close trading update for 2013, in which the contractor said trading was “broadly in line with expectations” with an £18bn book of orders and probable orders at the year-end.

Carillion said total revenue in 2013 would be lower than in 2012 due to the slow starts to the Green Deal and Energy Companies Obligation markets, which has prompted a £40m restructure of its energy services business.

It incurred costs from the acquisition of John Laing Integrated Services for £17.5m in October; however, net debt is expected to fall to £250m at the year-end, compared with £270m at 30 June 2013.

Carillion also confirmed senior non-executive director Philip Green will succeed Philip Rogerson as chairman when he retires from the board in May 2014.

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