Costain settles dispute over Welsh motorway
By Sean Farrell
Date: Wednesday 17 Feb 2021
(Sharecast News) - Costain has agreed a settlement with the Welsh government over their long-running dispute about the troubled A465 motorway project.
The infrastructure group said the financial terms of the agreement were in line with the provision it made for the year to the end of December.
The company said in September it had set aside £45.4m for dispute over the Heads of Valleys road, which was delayed by two years and cost £100m more than budget. The provision and another £49.3m charge for a contract with National Grid drove it to a first-half loss announced in September.
"As a result of the settlement, the company has certainty of the final account sum payable by the Welsh government to the company, including further milestone payments," Costain said.
"Work on the contract is nearing completion, and the company continues to be responsible for the delivery and the management of associated project risks for the remaining works, which are scheduled to be completed in September 2021."
Costain contested responsibility for problems with design information for the delayed road for two years. In December 2019 Costain was ordered to pay half the costs in an arbitration ruling.
The company's shares, down about 70% in the past year, were little changed at 58.89p at 09:17 GMT.
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