Goco

Kiran Stacey

Back in October, the FT revealed that Philip Hammond’s bold plan to part-privatise the MoD’s weapons-buying arm were in trouble, with one of the two potential bidders worried about various aspects of the bid.

At the time, the consortium, led by CH2M Hill, was worried about whether the terms on offer were commercially attractive. It was also worried about the status of one of its component companies, Serco, which is under threat of not being able to bid for government contracts in the future after allegations emerged it had overcharged taxpayers for tagging offenders.

Today, the CH2M Hill consortium dropped out altogether, leaving only one bid, led by Bechtel, the US engineering group. The company says the commercial terms on offer were simply not good enough to continue with the bid.