Edinburgh is likely to press ahead with the pound;180 million second phase of its school building programme, funded through a public private partnership (PPP).
Following talks with the Scottish Executive and a council meeting yesterday (Thursday), the city will reopen negotiations with Axiom Education as the sole bidder.
Balfour Beatty, the other contender, withdrew after it received commercially sensitive information passed on to a consultant by Colin Dalrymple, former depute director of education, who has been sacked.
A police investigation is continuing.