1 November 2017 | Herpreet Kaur Grewal
Carillion's board has announced the disposal of the group's 66.67 per cent shareholding in Ask Real Estate Limited (AREL) for £13.8 million.
Carillion is also selling its 50 per cent interest in Ask Carillion Developments LLP (ACD).
Some of the agreed figure -
£1 million - is contingent on the sale of 100 Embankment in Salford, Greater Manchester, and will be paid by Dukehill within five business days of signing of the sale documentation.
Ask carries out commercial property development activities - together with various partners - in the North of the UK, including Manchester, Liverpool and Leeds.
In the 2016 financial year Ask contributed £4.1 million of revenue, £11.6 million profit before tax, and £19.2 million gross assets as at 31 December 2016.
The transaction is expected to generate a modest profit on disposal, and the interests being sold were not expected to make a material contribution to overall group profit for 2017.
The transaction consideration will be applied in reducing the group's overall leverage position and, following the transaction AREL will be deconsolidated from the group's accounts. AREL managing director John Hughes and finance director Jonathan Cross, who together own 33.33 per cent of AREL, will retain their executive positions.
Keith Cochrane, interim chief executive at Carillion, said: "We are pleased to be able to announce further progress. Much remains to be done, and we are continuing to execute our plans to refocus the business, reduce cost and strengthen our balance sheet."