OUTSOURCING giant G4S has put its struggling US government unit on the block, as it looks to exit a business that has been hit by defence budget cuts and bureaucracy.
G4S said its US government solutions business, whose operations include emergency services, mine detection dogs and weapons training, generated around £400m in revenues last year, or approximately five per cent of group turnover.
The firm said its status as a non-US company made it more difficult to access sensitive information needed to run the business. The unit has also been under pressure from spending cuts at the Pentagon.
G4S will continue to work in the US in roles where high level security clearance is not needed, it said in a statement.
Analysts at RBC Capital Markets said that between £80m and £120m would be a reasonable sale price, depending on the synergies on offer for the eventual buyer.
Investment bank Houlihan Lokey is managing the sale process, with a US-based team led by managing director Jean Stack alongside directors John Song and Warren Romine. G4S hopes to complete the sale within the next six months.