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July 17, 2014 11:06 pm
G4S is selling its Swedish alarm business for £37m, as the security company battles to turn round its fortunes, which have been damaged by a series of scandals involving its work for the British government.
Revenues at the Swedish business, which employed 3,400 staff, would have been £107m this year on margins of just 2 per cent. It has been bought by Sector Alarm, which provides home security systems in Norway, Sweden and Ireland.
The divestment is part of a long-term strategy by Ashley Almanza, chief executive, to sell or restructure poorly performing businesses, mostly in developed countries. It has already raised £165m from disposals in the year to March, including a Canadian cash delivery business.
G4S, which employs 618,000 staff in 120 countries and is the world’s biggest private sector employer after Walmart, is in the middle of overhauling its sprawling empire, shaking up management, cutting costs, improving customer service and restructuring weak divisions to help revive its fortunes.
All of its contracts are currently being reviewed to ensure it avoids unnecessary risks. The company recently confirmed that it would withdraw from controversial work supplying security equipment for the Israeli government by 2016.
Mr Almanza, a former executive at oil and gas group BG Group, was promoted to chief executive last June after a string of blunders including a failed takeover bid in 2011 and a botched contract to staff the 2012 Olympics claimed the scalp of his predecessor Nick Buckles.
The company – along with rival Serco – remains under investigation by Britain’s Serious Fraud Office for overcharging the government for tagging criminals who were dead, in prison or never tagged in the first place.
Mr Almanza said: “The sale of our business in Sweden is part of our active portfolio management programme which we announced in November last year to improve our strategic focus, capital discipline and returns.”
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