G4S says Algeria, Mali unrest raising security demand
By Neil Maidment | January 26, 2013 5:00 AM EST
G4S, the world's biggest security firm, is seeing a pick up in demand for its services from embassies and companies across Africa in the wake of unrest in Mali and Algeria.
The British group, battling to recover at home from botching a contract at last year's London Olympics, is seeing a rise in work ranging from electronic surveillance to protecting travellers, its regional president for Africa told Reuters.
"Demand has been very high across Africa," Andy Baker said in an interview. "The nature of our business is such that in high-risk environments the need for our services increases."
Trouble in Mali and Algeria has dominated recent media headlines, with France leading an operation to drive Islamist fighters allied to al Qaeda from northern Mali, and an al Qaeda raid on an Algerian desert gas plant, which saw 38 mostly foreign hostages killed.
In Britain, G4S's reputation was damaged last year when it failed to provide the agreed number of security guards for the London Olympics, and analysts are still unsure whether the fiasco will have a lasting impact on its business in the country, particularly with the government.
However the group, which makes about 22 percent of its revenues in Britain and Ireland, is expanding rapidly elsewhere.
Its emerging markets business, which includes its operations in Africa, accounts for over a third of group profit and helped to drive revenues up 5.5 percent for the first nine months of its financial year.
G4S is already one of Africa's largest private sector employers with over 110,000 staff in 29 countries across the continent, and Baker said the rise in demand for its services was not just confined to the countries directly hit by unrest.
"The issues going on in some of the countries across Africa can't really be considered single-country issues, they become regional quite quickly," he said.
"For example, the Algerian hostage tragedy was ostensibly retaliation for the French moving into Mali, so there are regional implications in many of these countries and that brings with it many threats, so demand is high."
He said G4S, which shares intelligence on al Qaeda with governments, had seen a pick up in demand for travel protection from embassies and companies in Mali, Nigeria, Kenya and South Africa in particular.
Multinational companies were also approaching the group about pan-African security deals, he added, with one contract with an unnamed oil and gas firm signed late last year and another with a major global bank on the cards.
G4S, whose clients include oil group Royal Dutch Shell, bank Barclays and miner AngloGold Ashanti, makes around 500 million pounds ($789 million) of turnover in Africa out of a group total of 7.5 billion pounds.
Its services also include running a prison, assisting at crime scenes and transporting cash.
G4S is also targeting opportunities in Africa's buoyant natural resources sector.
(Editing by Mark Potter)