Under-fire G4S said to be eyeing up cash call from shareholders

 
City A.M. Reporter
SECURITY firm G4S has held talks with large investors about the prospects for tapping them for cash, Reuters news agency reported.

G4S chief executive Ashley Almanza has ordered a sweeping review of G4S and is expected to announce measures to try and repair its balance sheet when he reports half-year results in August, Reuters reported.

Asked about the possibility of a rights issue, Almanza told The Sunday Times newspaper: “Shareholders have asked about this. I will conduct a full review of the business and evaluate the various options, and we have many options. I have not given any signal either way.”

His comments follow a difficult week for the company.

The government said on Friday it would not be awarding any new contracts to G4S and rival Serco until they received a clean bill of health from a review after an audit found they had charged for tagging criminals who were either dead, in prison or never tagged in the first place.

Shares in G4S, which makes around 10 per cent of its turnover from British government work, have tumbled 25 per cent over the past year amid a series of scandals. Its reputation was hit last year when it failed to provide enough security guards for the London Olympics and a profit warning in May led to the departure of chief executive Nick Buckles.