Eaga is to Now Be Bought Out by Carillion

Apparently well-known home insulation installer Eaga has now agreed to be bought out by Carillion. More than likely, this deal was accepted because Eaga has been hit very hard by government spending cuts. Current reports are suggesting that the deal is going to go down for more than £300 million.

Eaga, which is a Newcastle based supplier of energy-saving services, has been given the go ahead for Carillion to buy its shares at 120p each. This deal pretty much values Eaga’s equality at around £307 million when all is said and done.

The chief executive of Carillion, John McDonough, said that the two companies have been discussing this tie-up since the early part of last year. However, until now, it has never been given the go ahead. Now with the acquisition of Eaga, Carillion can meet customers’ needs better.

He went on to say that Eaga actually fills a hole in Carillion. On top of this, it gives Eaga the power to take advantage of the growing green energy market. The companies shave spent a lot of time getting to know each other. Now seems like the right time to make the deal.

Eaga has been in trouble for a long time now. In fact, Eaga had a loss of about £5 million in the six months to November 30 of last year on sales of £308 million. This happened after the coalition government decided to phase out a scheme that was called Warm Front. Under that scheme, the government paid Eaga to install insulation and new heating systems in poorer households. The shares of the company were hit rather hard by this big announcement.