The problems at Ferranti International Signal Plc are every bit as bad as the City’s worst fears, judging by a cryptic statement issued by the company on Friday. Ferranti said that the position with regard to the overseas contracts of ISC Technologies that led to it asking for its shares to be suspended is far from resolved and that there are indications that lead the board increasingly to suspect significant irregularities in relation to some of these contracts. The company points out that the contracts were in force either prior to the merger with International Signal & Control Group Plc or relate to inventory held by ISC at the time of the merger – not much comfort to shareholders since due diligence searches conducted on behalf of Ferranti before the merger should have found these things out. The company has appointed Coopers & Lybrand to undertake urgently a full investigation of ISC Technologies Ltd’s contracts.
