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Carillion reclassified as 'Business Support Services'

16 June 2008

FTSE/Dow Jones changes Carillion’s classification to Business Support Services and Carillion sells equity in four Public Private Partnership (PPP) projects

The Board of Carillion has been advised by the FTSE/Dow Jones Indexes that Carillion's Industry Classification Benchmark (ICB) will be reclassified from sub-sector Heavy Construction to Business Support Services. This change will be implemented after the UK market closes on Friday 20 June with Carillion’s first day of trading in the Business Support Services sector being Monday 23 June.

This move reflects the material change in composition of Carillion's business activities in line with the Group’s strategy for growth, which, following the acquisition of Alfred McAlpine earlier this year, has created a leading UK support services businesses.

As announced on 19 May 2008, Carillion will be hosting a presentation for analysts and investors on its support services business and on its pre-close update on trading, on 30 June 2008.

Carillion plc has sold equity investments in four fully operational Public Private Partnership projects, generating cash proceeds of £35.9m, which reflected an average discount rate of below 5.5 per cent. The four PPP projects in which Carillion has sold its investments are Lewisham Hospital, James Cook University Hospital, Barnsley Schools and Redcar and Cleveland Schools.

Following this latest equity sale, Carillion has 21 financially closed projects in which it has invested, or has commitments to invest, approximately £175m. In addition, Carillion has a strong pipeline of projects for which it is either the preferred bidder or shortlisted, which together have a potential equity requirement of up to £80 million. Beyond that Carillion expects continuing opportunities to win further projects in the UK and Canada, which have PPP programmes in Carillion’s key market sectors.

Commenting on the sale, Carillion Chief Executive, John McDonough, said: “This sale of PPP equity investments has once again demonstrated the value we are generating through Carillion’s ability to provide fully integrated solutions for PPP projects, including project finance, design, construction, maintenance and whole-life asset management, which helps us to win projects and deliver them successfully into the operational phase.”

The equity investments were purchased by Innisfree, Land Securities Trillium (“LST”), Barclays European Infrastructure Fund and Robertson Capital Projects.

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