G4S sells out of $57 million US prison contract

Security behemoth G4S has finally broken out of its US youth prisons business, selling it to American mental health firm BHSB for $57 million (£45 million).

G4S’s youth services business in the US runs juvenile jails in Florida, Texas and Tennessee, turning a pre-tax profit of around $5 million a year. But it’s been beset with controversy, with a grand-jury report in 2015 describing one G4S facility that was the site of a riot involving more than 130 children as “a disgrace to the state of Florida” which should be closed down.

Today’s deal sees senior management in G4S Youth Services transfer from the British outsourcing giant to BHSB’s payroll at completion.

Ashley Almanza, chief executive of G4S, said the sale was “part of our portfolio management programme initiated in 2013 to improve our strategic, commercial and operational focus”.

That new strategy followed Almanza’s appointment after the company’s high-profile and expensive failure to provide enough security for the London Olympics, resulting in troops being drafted in to cover the shortfall.

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