Carillion’s joint venture partners on High Speed 2’s (HS2) main civil works packages will ensure that the contract will be delivered should there be any change to Carillion’s role in the joint venture. Today Carillion will hold a crunch meeting with lenders to decide how it will operate in the future.
In July last year, the CEK joint venture was awarded two of the seven HS2 main civil works packages, both in the central section of the route – C2: North Portal Chiltern Tunnels to Brackley and C3: Brackley to South Portal of Long Itchington Wood Green Tunnel.
HS2 said the contract for the works was with CEK, not the individual companies in the joint venture, therefore Carillion’s JV partners Kier and Eiffage will step in to cover the work if needed.
Carillion is set to present a business plan to creditors today in a bid to restore its balance sheet and safeguard its future, with much speculation of what will come out of the meeting, including predictions of an interim agreement with lenders.
The construction company issued its first profit warning at the time of the contracts’ award and as a result, HS2 wrote to Kier and Eiffage to remind them of the clause saying they would step in and seek confirmation they were willing to continue.
At the time HS2 said: “Obviously in the light of last Monday’s announcement by Carillion, HS2 has carried out additional due diligence and sought re-assurance of both it and its two partners in the joint venture - Kier and Eiffage - that they remained committed and able to deliver the contract.
“Each company’s boards have both given that assurance and confirmed that they underwrite the performance of each other in delivering the contract. And that is the key point. HS2, of course, will continue to monitor the situation.”