LONDON (ShareCast) - Support and construction company Interserve is the only UK-based company to have been named among the preferred bidders for the 21 rehabilitation services contracts by the Ministry of Justice (MoJ).
The group was named as the preferred bidder for five of the contracts, covering Humberside, Lincolshire & North Yorkshire, West Yorkshire, Cheshire & Greater Manchester, Merseyside and Hampshire & Isle of Wight.

All but one of the 21 contracts are to be led by new partnerships and joint ventures between private sector companies and
British rehabilitation charities, with half of the partnerships expected to include new 'mutual' organisations created by existing probation services staff.

According to Liberum's estimates, the average contract value of deal like those signed by Interserve was between £20 and £25m.

The broker, however, warned that as the outsourcing probation services is untested in the UK, it could be met with disapproval by the union, thereby making it complicated for Interserve to make cost savings.

Liberum said the award was negative for Capita PLC, Carillion PLC and Staffline Group PLC, all of which were unsuccessful with their bids and added that while it remain a positive outlook on Interserve, Carillion and Staffline, it was more cautious on Capita and Serco.

Interserve shares were 3.28% up to 614.50p on Wednesday.

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