Babcock blasts ‘false and malicious’ report by anonymous analyst

Babcock has said it is trying to track down the author of an anonymous analyst’s note which questioned the company’s relationship with the Ministry of Defence.

Shares in the FTSE 250 engineering services company have not recovered since dropping four per cent after the note was released last month.

But now Babcock has hit back, saying it was riddled with “false” claims, without providing any specifics.

“This report included many false and malicious statements which the group strongly refutes. At the same time, the group continues to seek to discover who is behind Boatman Capital,” the company said in a statement.

Babcock has been a key partner to the MoD for over 30 years and is currently its second-largest supplier with 128 UK government contracts, the company said.

“We meet with the MOD on a regular basis and our relationship remains as strong as ever,” it said.

A government spokesperson said: “We monitor the health of all of our strategic suppliers, including Babcock, and remain committed to working with them on a wide range of programmes.

“Babcock plays a key part in equipping our world leading armed forces and the MoD spent more than £1.7 billion with the company last year, supporting thousands of jobs across the nation.”

The company’s shares rose 2.43 per cent after the news this morning to 615p.

However, shares have dropped from 654p since the Boatman Note was released in mid-October.

Despite being dismissed by many analysts, and coming from an anonymous source, Boatman Capital's note was enough to damage Babcock’s share price.

It claimed there were fissures between the company and its key client, and that chairman Mike Turner and chief executive Archie Bethel were given a “bollocking” from the MoD, the Sunday Times reported.

After months of speculation, the company recently announced it would close its Appledore shipyard in Devon, promising to relocate all its 199 employees there to other Babcock facilities.

In the last financial year the shipyard generated around £24m of the group’s £5.4bn underlying revenue.