Serco wins £1.5bn contract to run Australia's biggest prison
Outsourcing giant Serco has secured its biggest ever contract after winning a £1.5 billion deal to run what will be Australia's largest prison.
The group said it had been signed up to manage the New Grafton Correctional Centre (NGCC) in New South Wales.
Shares in the firm lifted 3% as the contract cheer provided further evidence of the group's bounce back amid a restructure following a string of profit warnings and prisoner tagging scandal in 2013.
Serco is part of the NorthernPathways consortium which will design, build and operate the prison in Australia in a Public Private Partnership deal for the New South Wales government.
The contract is due to start in 2020 and is worth around 2.6 billion Australian dollars, or £1.5 billion, over 20 years.
The prison will hold three different categories of inmates and will include a 1,000-bed male maximum security facility, a 300-bed female maximum security facility, and a 400-bed male minimum security facility.
Serco already manages jails in the UK, New Zealand and Australia, but it will be the first facility including women.
Rupert Soames, group chief executive of Serco , said: "The contract award for NGCC clearly marks a further important expansion of our international justice business and by total contract value it also represents Serco's largest ever contract."
Serco has been recovering in recent years after admitting in 2013 to charging the UK Government for tagging criminals who were dead or non-existent.
It was also been hit by rising costs on a deal to provide accommodation to UK asylum seekers.
Joe Brent, analyst at Liberum, said the deal had been "one of the elephants that Serco had targeted".
But he added: "It has been a slow period of contract-winning so far this year and the contract only starts in 2020."