Carillion rail contracts taken over by Amey

Amey Rail Limited has acquired a number of Carillion’s Network Rail contracts, after the outsourcing giant went into liquidation in January 2018, safeguarding over 700 jobs

The contracts taken over by Amey includes work on the development of Crossrail’s Old Oak to Paddington section, electrifying the strategic railway network around Manchester and the increasing of capacity on the Midland Mainline.

Network Rail is continuing to work with PwC to seek transitional arrangements for the remaining contracts and staff.

Last month, it was agreed that PwC will pay Carillion employees’ wages for work done on and supporting Network Rail’s contracts until after Easter and many of the construction companies smaller rail suppliers were paid the arrears they were owed to ensure the continued delivery of important projects.

Matthew Steele, commercial director Network Rail, said: ‘This is a positive step for the industry, ensuring the delivery of a number of major rail projects across the country whilst safeguarding an expected 700 jobs and the wider supply chain. We look forward to working with Amey to enable a smooth transition and ensure the ongoing safe working on our sites.

‘We do recognise that this has been a very unsettling period for the employees of Carillion and would like to thank them for the continued commitment to the delivery of these projects. We remain focused on the transfer of remaining projects and employees to new arrangements over the coming weeks and months.’

Chief Executive of Amey, Andy Milner said: ‘With a deep understanding of these operations, we are perfectly placed to become the new contractor for these projects. This will mean that our rail business will grow significantly, as we support Network Rail to deliver critical milestones. We look forward to welcoming the employees to our business, and further strengthening our relationship with Network Rail.’

BDO, who has been advising Network Rail on the implications of the collapse of Carillion, supported the sale of Carillion’s rail division to Amey.

Simon Michaels, head of Corporate Advisory at BDO, said: ‘On hearing of the severe financial distress and subsequent liquidation of Carillion, we have been working closely with the team at Network Rail.

‘As a significant supplier of services to National Rail, Carillion’s collapse had considerable implications for the continuity of many high-profile rail infrastructure projects. This deal is good news for Network Rail, its supply chain and the jobs that have been saved, and it ensures the continuity of many essential rail infrastructure contracts around the country.’

Report by Amy Austin

Amy Austin |Reporter, Accountancy Daily [2016-2019]

Amy Austin was reporter, Accountancy Daily and Accountancy magazine, published by ...

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