Kier Group has said its chief executive will leave with “immediate effect” in the wake of a failed emergency fundraising by the construction group.
Kier said on Tuesday that CEO Haydn Mursell “will stand down from the board” and “leave the business,” even though it has not yet identified his successor. Chairman Philip Cox will move into an executive chairman role to oversee the business during what it called a “transformation period until a new chief executive has been appointed.”
Outlining its reasons for Mr Haydn leaving, Kier said the decision for him to go had been made by the group’s board.
“The board believes that following the completion of the recent rights issue, now is the right time for a new leader to take Kier forward to the next stage of its development,” the company said in a stock exchange announcement.
Kier’s business is trading in line with expectations, the group said on Tuesday, but investors and lenders have cut exposure to its sector following the failure of Kier’s onetime rival Carillion, a UK government outsourcer that collapsed under the weight of unsustainable debts.
While Kier raised £250m in a rights issue in December, just 38 per cent of its shareholders took up the discounted shares it sold in the deal. The group’s banks and brokers were left holding about £100m worth , which they later sold on.
In its trading update on Tuesday, Kier said that it had reduced its net debt to £370m, down from £410m in the second half of last year, thanks to the right issue. It said that new contract wins in infrastructure services and building businesses meant it now had forward orders book worth £10bn.
New contracts Kier has won recently included over £500m worth of regional building projects, such as a major office development for Argent at King’s Cross in London, and a new hospital for Frimley Health NHS Foundation Trust, the group said.
Kier shares have plunged 42.5 per cent over the past year.