Bloomberg News

U.K. Wants Stability at G4S, Not Resignations, Minister Says

July 18, 2012

U.K. Olympics Minister Hugh Robertson said he wants “stability” at G4S Plc (GFS) rather than “resignations and chaos” as the company struggles to provide enough security guards for the London Olympic Games.

Asked if G4S Chief Executive Office Nick Buckles should resign, Robertson told reporters in London today that the company is still a key partner and he is confident it will deliver on its obligations.

“I want stability at that firm, I don’t want resignations and chaos,” Robertson said. “At the moment the important thing is we deliver a safe and secure games and G4S is an important partner in that. I have absolute confidence the company will deliver.”

Lawmakers on the House of Commons Home Affairs Committee said yesterday that they have no confidence in the company after Buckles agreed that the staffing shortfall that forced the government to deploy thousands more soldiers and police was a “humiliating shambles.” The company’s performance was “unacceptable, incompetent and amateurish,” committee chairman Keith Vaz told Buckles.

G4S’s shares rose after four days of declines. Shares of the Crawley, England-based company rose 3.25 percent to 247.80 as of 12:53 p.m. in London after dropping by as much as 17.9 percent from July 11 to a low of 238.80 on July 17.

Robertson said government lawyers are working on activating all of the penalty clauses in the G4S contracts, including the 57 million-pound management fee, which Ian Horseman-Sewell, G4S’s global events specialist, said the company expects to retain.

“All the penalty clauses in the contract will be activated,” Robertson said. “What happens to Mr. Buckles afterwards is a matter for others in the post-games period. What matters now is that he and his company concentrate on delivering a safe and secure Olympics.”

To contact the reporter on this story: Thomas Penny in London at tpenny@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net


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