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Metronet BCV and Metronet SSL apply for PPP administration

The directors of Metronet BCV Ltd and Metronet SSL Ltd, the PPP concession companies responsible for the upgrade and maintenance of two-thirds of London Underground’s rail system under the Public Private Partnership, have asked the Mayor of London to seek the appointment of a PPP Administrator for these companies. Balfour Beatty has a 20% interest in these companies.

In its 2007 interim trading update on 26 June, at which time the Metronet concessions were going concerns, Balfour Beatty announced that there would be an exceptional charge of approximately £100 million in its half-year accounts in respect of its interest in Metronet. This arose in the light of the level of unanticipated costs associated with Metronet’s capital programmes and Metronet’s funding position at that time. The charge comprised, largely, the write-off of Metronet equity and the write-back of profits in respect of the equity investment, recognised in previous years. In the light of this application, the exceptional charge may be higher, with the final sum reflecting the extent to which day-to-day trading balances between Balfour Beatty operating and affiliate companies and Metronet are recovered.

Balfour Beatty will work closely with Metronet, London Underground and the Administrator in order to ensure that the daily operations of the tube remain unaffected over the coming period. The company remains committed to the creation of a world-class underground system for London and will continue to provide such services to London Underground as required and requested under the new ownership structure which succeeds Metronet.

ENDS

Enquiries to:

Tim Sharp
Tel: 020 7216 6884
www.balfourbeatty.com