Re Contract

Carillion PLC
03 January 2008


3 January 2008

Carillion joint venture achieves financial close on South Tyneside and Gateshead
      Building Schools for the Future PPP contract valued at £175 million

Support services and construction company Carillion and its joint venture
partners, The Local Education Partnership (LEP), have achieved financial close
on the £175 million South Tyneside and Gateshead Building Schools for the Future
(BSF) programme.

The LEP will deliver 14 secondary schools in the current wave of the BSF
programme, with a total area of approximately 100,000 square metres. This wave
of the programme will also include the provision of healthcare facilities.

As well as investing some £2 million of equity in the project, Carillion will
carry out the construction work in three phases over four years, starting in
January 2008 with all schools open to pupils by January 2012.

Carillion will also provide facilities management services for the new schools
over the life of the 25-year concession contract, to the value of approximately
£16 million. This involves the delivery of FM services including mechanical,
electrical and building fabric maintenance, caretaking, security, cleaning and
grounds maintenance services and full life cycle responsibility.
The LEP will also provide further new schools for South Tyneside and Gateshead
in subsequent waves of the BSF programme and may deliver other community
regeneration projects, subject to these receiving the necessary approvals.

Commenting, Carillion chief executive, John McDonough, said: 'We are delighted
to have achieved financial close on our first project under the BSF programme,
which we expect to be a strong growth area for the Group. We have built an
excellent partnership with South Tyneside and Gateshead Councils that has
resulted in financial close being achieved in just 12 weeks. We look forward to
developing this successful partnership to deliver the 'Education Vision' for
both Councils with state-of-the-art community focused schools.

'The contract also includes the delivery of a £5 million primary care centre
co-located with a new council community centre and library and demonstrates the
flexibility of this procurement route for providing a wide range of community
improvement initiatives.'

- Ends -



Notes to editors

The Local Education Partnership comprises Partnership for Schools, South
Tyneside and Gateshead Councils, Carillion and Royal Bank of Scotland.
Partnerships for Schools and South Tyneside and Gateshead Councils will provide
20% of the equity with the remainder being provided by Inspired Spaces, a joint
venture between Carillion (40%) and Royal Bank of Scotland (40%).

Information technology will be provided by Morse with the design team comprising
Ryder Architects, Cundalls Engineers and Colour Landscape as architects.
Carillion plc is one of the UK's leading support services, construction and
Public Private Partnership project companies. The Group has annual revenue of
around £4bn, employs over 40,000 people and operates across the UK, in the
Middle East, Canada and the Caribbean.

In the UK, Carillion has eight principal market sectors - Defence, Education,
Health, Building, Facilities Management and Services, Roads, Rail and Civil
Engineering.

In the Middle East, the Group's two principal market sectors are Construction
and Facilities Management. In Canada and the Caribbean, the Group's main sectors
are Health, Roads Maintenance and Construction.

The Group is a leader in Public Private Partnership projects, particularly in
the Defence, Education and Health sectors in the UK and in the Health sector in
Canada.

Carillion's education portfolio includes Leeds, Renfrewshire and South Ayrshire
schools.

This and other news releases relating to the Group can be found at
www.carillionplc.com.

For further information on Carillion:
John Denning, Director Group Corporate Affairs, Carillion plc 01902 316426



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