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£227m deal for troubled firm

Interserve secures DWP contract after shares plunge

Haymarket 3

Interserve is behind plans for the development of Haymarket in Edinburgh

Construction and facilities management company Interserve has been awarded a five-year government contract a day after the company’s shares plunged 27% following a profit warning.

Interserve, which has two big contracts in Edinburgh – for the extension to the National Galleries and the development of the Haymarket gap site – has secured a facilities management deal worth £227m for the Department for Work and Pensions (DWP). Its shares recovered, rising 12.7% in early trading.

It will provide the DWP estate with mechanical, electrical and building maintenance.

The company, which yesterday warned  it may breach covenants, will also provide cleaning, catering, waste disposal, removal and secure destruction of confidential waste services to over 700 buildings throughout the UK, covering over 1.3 million square metres of space.

The contract is part of a model being launched to manage the DWP estate along with Sodexo and will replace the DWP’s existing Private Finance Initiative contract, which ends on March 31, 2018.

The model will allow DWP to focus on transformational objectives and strategic estates management, while being supported by a supply chain of specialist organisations to deliver the specific services needed to operate the DWP estate.

Debbie White, chief executive at Interserve said: “We are delighted to be working with the DWP on this exciting new chapter in its history.

“Our goal is to deliver a seamless transition to providing facilities management services to the department.

“We understand the needs of the DWP to provide a safe, effective, compliant and accessible space for their employees and customers and we look forward to continuing to support the DWP in delivering a cost effective and efficient service.”

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