Canadian firm BGIS pulls out of planned takeover of outsourced government contracts.
A Canadian firm has pulled out of a deal to buy a substantial number of public sector contracts from collapsed outsourcing firm Carillion, putting at risk 2,500 jobs that looked set to be saved. Real estate and facilities management company BGIS said last month it had agreed with the official receiver managing Carillion’s liquidation to buy contracts to provide services to hospitals, the education sector, justice, transport and emergency services.
But in an unexpected announcement on Thursday, BGIS said the deal “will not be proceeding, as certain closing conditions have not been met”. It did not elaborate on why the deal fell apart.
“While we are disappointed at this outcome, we are continuing to pursue opportunities to grow our global business into the UK and welcome continued dialogue with prospective customers as we build out our platform for future growth opportunities,” said Gord Hicks, chief executive of BGIS.
A spokesperson for the official receiver said the sale was “conditional on ongoing support from customers for continued provision, but this could not be secured”.
It is understood that the customers include special-purpose vehicles used by government to manage public services, but it is not clear why a promise of continued support for those services was not forthcoming.
The deal would have guaranteed 2,500 jobs, boosting the official receiver’s efforts to find new employment for Carillion’s 19,500-strong UK workforce. The official receiver said earlier this month that 8,216 jobs had been saved, while 1,458 workers had been made redundant during the liquidation process.
The 2,500 staff at risk from the failure of the BGIS deal are included within 7,500 who are being retained while the liquidation continues, to ensure that public services are not interrupted.