Racal Electronics Plc shares shed fivepence to 169 pence after the company announced late yesterday that Racal Data Networks and HM Treasury have failed to agree a price on the supply of an integrated voice and data telecommunications service, known as the Government Telecommunications Service, and negotiations have been called off. Neither party is prepared to disclose figures, but when the negotiations were announced in February, it was estimated at UKP1,000m over 10 years (CI No 1,367). Racal says that the breakdown of negotiations won’t affect its existing government contracts, worth UKP700m over 10 years, and the Treasury says that it is now unlikely that it will proceed with the project.
