Galliford to raise £157.6 million for bypass contract following Carillion collapse
Galliford Try is to raise £157.6 million through a rights issue to help cover costs for a road contract in Aberdeen that it had run with its now defunct partner Carillion.
The group said the money will be used for the Aberdeen Western Peripheral Route (AWPR) bypass, which was originally a project between Galliford, Balfour Beatty and Carillion.
However, Carillion was liquidated in January and, under the terms of the contract, remaining joint venture members are obliged to complete the project, with any shortfall funded equally.
Galliford said in a statement: "The group continues to make good progress towards resolving AWPR and practical completion of the construction work is expected in summer 2018.
"Further, despite the issues encountered in relation to AWPR, the 2021 strategy and related financial targets remain unchanged."
Galliford shares were up nearly 2% in morning trade.
However, despite completion scheduled for the summer, Scotland's Economy Secretary recently said the opening will be delayed until autumn.
Keith Brown said that although the consortium's target is to open the 28-mile bypass during August, Transport Scotland has indicated a "late autumn" completion is anticipated.
Since Carillion's collapse, more than 90% of its former workers on the Aberdeen bypass have been given jobs with the two other partners in the consortium.
Carillion's liquidation left in its wake a £900 million debt pile, a £590 million pension deficit and hundreds of millions of pounds in unfinished public contracts.