Jarvis, the troubled support services group, is planning to sell part or all of its key PFI division, Jarvis Accommodation Services
The sale of the division, which builds and manages schools, would raise much needed cash after Jarvis reported a huge pre-tax loss of £247m in its annual results in July.
It is understood Jarvis is in talks to sell off the construction arm of Jarvis Accommodation Services, with about £100m of future business.
It is not yet clear, however, whether Jarvis also intends to sell the facilities management division. The division has been appointed on contracts worth about £70m and is considered to be part of Jarvis’ longer-term strategy.
A statement at the time of the results said that Jarvis would focus on UK rail activities and roads, which mainly refers to facilities management.
A spokesperson for Jarvis would not comment on any specific negotiations but said: “We made it very clear in our preliminary results that we had a number of businesses that are not core. Unsurprisingly, people are talking to us about those businesses.”
Jarvis announced earlier this month that it was also selling its University Partnership Programme, which provides and operates student accommodation, to the Alma Mater Fund – a joint venture managed by venture capitalist 3i and Barclays Private Equity.
We made it very clear that we had a number of business that are not core
News about bonus payments also emerged this week. Six directors of the group, five of whom have left, shared an £800,000 bonus pool for the same year as the rail crash in Potters Bar, Hertfordshire, in which seven people died.
Jarvis’ annual report on Tuesday revealed that the directors, including former chairman Paris Moayedi, received a bonus for the year ended 31 March 2003. The bonus payments had been deferred from last year while the Potters Bar enquiry was continuing.
A spokesperson for Jarvis said the company was contractually obliged to pay the bonuses and had been advised by its lawyers to do so.
Jarvis said no bonuses would be paid out for the year ended 31 March 2004 because of the huge pre-tax losses.