Serco Suffers!

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Serco had a dismal start to the week. Oh good! The outsourcer admitted it had been stripped of a government contract to run the facilities that make nuclear warheads.

The Ministry of Defence has decided to take back control of the Atomic Weapons Establishment (AWE) from a group including Serco which had a 24.5 per cent stake as well as American firms Jacobs and Lockheed Martin.

It will be renationalised next June, turning it into an ‘arms-length body wholly owned by the Ministry of Defence’ and cutting short a 25-year contract handed out at the turn of the millennium.

More so than profits at this stage, perhaps, the decision deals another blow to Serco’s reputation. Recently it has been criticised for its role in managing several coronavirus call centres and testing sites but it was previously in the spotlight when a fire broke out at AWE in 2013.

Serco shares plunged 13.3 per cent, or 17.2p, to 112.2p. Oh dear!

Would you put Serco in charge of a sweet shop, or even a golf course?

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