Government 'to scrap defence float'

THE Government is reportedly planning to scrap the float of the Ministry of Defence's former research laboratories. Worried about turbulent stock markets and the backlash from Railtrack, the state is likely instead to seek a private investor, the Sunday Times reported.

The research organisation, Qinetiq, was to be floated, possibly by the end of this year, with a price tag of around £250m.

But Whitehall is concerned that the fallout from Railtrack, which the Government forced into administration in October, has damaged further privatisations.

Adviser UBS Warburg is expected to give its view in the New Year, the paper reported. Most observers reckon it will recommend selling about a third of Qinetiq to a third party.