Re Contract

Carillion PLC
27 September 2007


27 September 2007

   Carillion joint venture appointed preferred bidder for South Tyneside and
 Gateshead Building Schools for the Future PPP contract valued at £175 million

Support services and construction company Carillion with its joint venture
partners (The Local Education Partnership) has been successful in moving forward
as the selected bidder for the £175 million South Tyneside and Gateshead
Building Schools for the Future (BSF) programme.

The Local Education Partnership (LEP) will deliver 14 secondary schools in the
current wave of the BSF programme, primarily through new build with some
refurbishment, 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 PPP concession contract, which will run for 25 years. The
scope and value of these services are still subject to negotiation and a further
announcement will be made about this in due course.

The LEP will 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 been selected for our first BSF 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 and look forward to working with them to provide state-of-the-art
schools that will help them deliver first-class education and other community
facilities.

'The contract also includes the delivery of a £5 million primary care centre
co-located with a new council community centre and library, which demonstrates
that this procurement route provides great flexibility for the provision of a
wide range of community improvement initiatives, including primary healthcare
facilities and other regeneration projects.'


Notes to editors
The Local Education Partnership comprises Partnership for Schools, South
Tyneside and Gateshead Councils, Carillion and Royal Bank of Scotland.
Partnership 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 is one of the UK's leading support services, construction and Public
Private Partnership project companies.

The Group has annual revenue of around £4bn and employs over 50,000 people.

The Group operates across the UK, in the Middle East and in Canada and the
Caribbean.

In the UK, the Group 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, please contact Paula Manning, Group Communications
Manager on 01902 316444.



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