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Babcock International - Preferred bidder for £7bn contract

May 2014

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • BAB
  • Price:
  • 1376p
The shares jumped after Babcock was made preferred bidder for the huge £7bn contract to manage the decommissioning of the 12 Magnox nuclear reactors as part of a joint venture with Fluor. JP Morgan Cazenove estimates the deal is worth £196m in annual sales over the next 14 years, which on a profit margin of 5% would boost eps by 5%. Separately, Babcock was also named preferred bidder to manage the London Fire Brigade's vehicle fleet for 21 years. Earlier, Babcock announced the acquisition of Avincis, a leading provider of helicopter and fixed wing services in mission critical operations such as medical, search & rescue, fire fighting and civil protection in Europe, as well as offshore services for the oil & gas sector. The ...

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