Re Contract

Carillion PLC
31 July 2006


Monday 31 July 2006

  Carillion joint venture reaches financial close on £880m PPP project for the
                              Ministry of Defence

Support services and construction company Carillion and its 50:50 joint venture
partner, HSBC Infrastructure Fund Management, have reached financial close on a
PPP project to redevelop, manage and operate the Northwood Headquarters, home of
the Chief of Joint Operations.

The project is expected to generate some £880 million of revenue for Carillion
over the 25-year concession contract, including construction, support services
and Carillion's share of revenue in the joint venture, special purpose company.

The contract will involve the provision of fully serviced accommodation on the
existing 43-acre site. Carillion will invest some £10 million of equity in the
project, 50 per cent of the total equity to be invested by the joint venture
partners.

Carillion will carry out a £150 million construction programme over a five-year
period and will also provide a wide range of support services, worth in the
region of £440 million over the contract period. Service delivery commences
immediately and includes domestic services, estate management, document
production and handling stores, transport and waste disposal.

Commenting, Carillion's chief executive, John McDonough said: 'This contract,
which closely follows Carillion's success in securing the £12 billion Allenby
Connaught project for the Ministry of Defence, further reinforces our leading
position in the PPP market and also as a major supplier in the Defence sector.

'This project plays to our strengths as a provider of integrated solutions for
large complex projects where we can apply our wide range of skills and
resources, including private finance, support services, design and construction.
These strengths and our commitment to working in partnership with the Ministry
of Defence were key to our success in securing this contract.

'We look forward to working with the Ministry of Defence to deliver first class
accommodation and services for those who live and work at Northwood.'

For further information contact
Paula Manning, Corporate Communications 01902 316444

Notes to Editors

The 43-acre site at Northwood includes the Chief of Joint Operations, Fleet and
NATO Headquarters and provides employment for over 2,000 military and civilian
personnel.

The Ministry of Defence has announced that the total value of the project is
£1.15 billion, which represents the indexed value of the unitary payments it
expects to make to the Special Purpose Company over the life of the concession
contract.

Carillion is a leading provider of integrated solutions for buildings,
infrastructure and services in the UK, with well-established international
businesses. Carillion has annual revenue in the region of £4 billion and has
over 40,000 employees. It delivers high quality, cost effective and sustainable
solutions using its wide range of skills and resources. Its key target markets
are defence, education, health and transport (rail and road infrastructure),
building and facilities management for public and private sector customers.
Carillion is also a leading provider of Public Private Partnership projects and
has a portfolio of 31 financially closed projects in which it has invested, or
has commitments to invest, a total of approximately £180 million of equity.



                      This information is provided by RNS
            The company news service from the London Stock Exchange