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G4S Stock Dips After UK MoJ Takes Immediate Control Of Birmingham Prison

Shares of Integrated security group G4S plc (GFSZY.PK,GFS.L) were losing around 2 percent in the early morning trading in London following reports that the UK Ministry of Justice has taken immediate control of Birmingham Prison from its contractor G4S.

HMP Birmingham, formerly known as Winson Green Prison, has been run by G4S since 2011 with a 15-year contract.

The government action was after inspectors said it had fallen into a state of crisis. The prison will not be returned to G4S for at least six months, until sufficient progress has been made.

As per reports, the MoJ has brought a new governor and extra staff. Further, the capacity of the prison will be cut by 300.

Prisons Minister Rory Stewart reportedly said, "What we have seen at Birmingham is unacceptable and it has become clear that drastic action is required to bring about the improvements we require."

In London, G4S shares were trading at 246.30 pence, down 2.42 percent.

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