Carillion Canadian backer dumps big slug of shares

 
Oliver Gill
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CANADA-IMMIGRATION
Carillion was included in a major school building framework earlier this week (Source: Getty)

One of Carillion's largest shareholders sold a big stake in the ailing contractor yesterday evening.

Canadian fund manager Letko, Brosseau & Associates sold millions of Carillion shares, reducing its interest from 4.61 per cent to 3.46 per cent a stake of 15m shares.

A regulatory announcement on the matter was made at 12.30pm today.

Shares in the Wolverhampton-headquartered firm rose sharply this morning after hitting new lows yesterday. They are currently 1.3 per cent up from yesterday's closing price.

The firm's market capitalisation is lingering around £85m, less than a tenth of its valuation at the start of the year.

Read more: From horror show to too big to fail: City reacts to Carillion meltdown

Carillion investors were dealt a fresh blow on Friday after the firm revealed it was expecting to breach banking covenants, had received a deferral on their testing from lenders and issued its third profit warning of the year.

The announcement prompted the UK government to reaffirm its support for Carillion as it seeks to resize operations.

Carillion continues to secure important contracts despite concerns about its future. On Monday it announced it had been included on a shortlist of firms selected to build new schools in the UK.

Interim boss Keith Cochrane said the announcement demonstrated "we continue to retain the confidence of key customers despite the group’s current challenges".

Letko, Brosseau & Associates has been approached for comment.

Read more: Carillion shares slide on school-building shortlist award

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