Shareholders in the tube maintenance company Metronet have written off more than 220 million pounds as banks refuse to lend the company any more cash pending the outcome of a dispute over cost overruns.
Last week the company gave notice to London Underground of its intention to invite the PPP Arbiter to conduct an Extraordinary Review.
Earlier this year Mayor of London Ken called on the Arbiter to decide “how much of the cost overrun must be borne by the Metronet shareholders – Atkins, Balfour Beatty, Bombardier, EDF Energy and Thames Water” adding it was time “for Metronet’s shareholders to stand up to their responsibilities.”
Yesterday two of those companies wrote off £221 million pounds – WS Atkins took a charge of £121m charge against Metronet with Balfour Beatty taking a charge of around £100m.
According to today’s Telegraph both “have written off their entire £70m equity investment” in the company which controls two thirds of the Underground network via two subsidiary companies.
In February this year a report by the PPP Arbiter concluded that “neither of the two Metronet Infracos has performed in line with the required standard over the period as a whole.”