Shares in troubled support services group Carillion (CLLN) shot up as much as 8 per cent on the day management confirmed it had received offers from “more than one credible counterparty” for its UK healthcare division.
The company said in its half-year update at the end of September that it would look to generate £300m from disposals of non-core businesses, having revised the estimate up from an original £125m.
However, investors should still be wary. Net debt had risen to £571m at the end of June, up from £291m on the same time the previous year. Management expects average net debt for the full year to be between £825m and £850m. Earlier this month, analysts at broker Peel Hunt issued a note warning there was still an ‘equity gap’ of £400m, even after assuming Carillion would be able to raise the full proceeds from disposals. The broker thought this gap might need to be bridged through an equity fund raising.
