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Fri May 20 2022

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Report says Kier to buy Tilbury Douglas

18 Jan Sky News is reporting that Kier is in talks to acquire Tilbury Douglas.

Unnamed sources said that the Cabinet Office had been notified of Kier's intention to acquire Tilbury Douglas. The government is a key client of both contractors.

Kier has had a rocky track record of acquisitions, with the takeover of May Gurney, Mouchel, Stewart Milne Construction and McNicholas boosting turnover but not always doing much for profits. A rights issue in 2018 to tackle the mounting debt burden flopped, leading to the departure of chief executive Haydn Mursell in January 2019.  His successor, Andrew Davies, was chief executive of Wates Group from 2014 until 2017. He left Wates in October 2017 when he was announced as the next chief executive of Carillion – but Carillion then collapsed in January 2018 before he had even started working there.

At Kier, Andrew Davies has restructured the business and returned it to profit. In the year to 30th June 2021 Kier Group made a pre-tax profit of £5.6m on revenue of £3,329m. Over the previous two years it had lost £470m. He has since sold the house-building division, Kier Living, to a private equity investor, raising £350m gross. A second rights issue last year went rather better than the first.

The latest available accounts for Tilbury Douglas – then called Interserve Construction – show that it made a pre-tax loss of £95m in 2019 on turnover of £465m.

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