Hot Features
Premium
Level up your trading with our powerful tools and real-time insights all in one place.
Security provider faces total losses of over £88m following compensation deal.
The London 2012 security contractor, G4S, has announced that it is reached a deal with Olympic organisers Locog after it failed to supply enough guards to fulfil its contract.
G4S will now face £70m worth of losses, £20m more than had been expected. Commenting on the deal Nick Buckles, the firm’s chief executive, said that he was “pleased” with the deal and that “”the overall cost to the taxpayer has been reduced significantly against the planned cost.”
Following the announcement G4S stock fell by 0.5p to 279.8p on the London market.
Speaking after the deal was announced Neil Wood, G4S’s chief financial officer, said the “savings arising from this settlement brings the total savings to the public purse from the Locog venue security budget to £102m compared to the position in December 2011.”
Over 3000 additional members of the UK Armed Forces had to be deployed to provide security during the games following news emerged that G4S was unable to provide the number of guards it had been contracted to.
Mr Buckles was subsequently called before a Parliamentary Committee to explain why the firm was unable to meet its obligations. Commenting on losses he said that G4S “have accepted responsibility for the security workforce issues and, as a result of the settlement terms which we have announced, have ensured that the overall cost to the taxpayer has been reduced significantly against the planned cost”.
Announced alongside the new Locog deal, G4S will donate a further £11m to charity and £7m in fees relating to marketing and sponsorship.
