CARILLION's due diligence during the £313 million acquisition of rival Mowlem was under the spotlight this week after the company announced an extra £90 million in write-downs on two Mowlem contracts.
A company source said: 'Obviously things were not thorough enough. We did all that was reasonable during due diligence, but the position deteriorated between then and the acquisition.' The loss-making jobs ? the £500 million Dublin Port Tunnel and the £95 million Exeter Schools PFI project ? have effectively added an extra £80 million to the cost of buying Mowlem.
Carillion has also written off another £30 million on businesses closed by Mowlem last year, but expects to make £40 million from the sale of non-core operations.