Kier has confirmed that it is still in talks with consultant Mouchel about a possible takeover – with the release of its results for the six-month period ended 31 December 2014 announced earlier this week.
Preliminary talks started in December with Kier stating: “The Group confirms that it is still in discussions regarding a potential acquisition of Mouchel.
“There can be no certainty that an acquisition of Mouchel will be completed. A further announcement will be made if and when appropriate.”
Kier completed the takeover of support services provider May Gurney in July 2013, with the company’s head of highways Nigel Dyer, recently telling Highways Magazine that the acquisition had filled a gap in its services portfolio.
The firm’s interim results show that group turnover was up 11% to £1.6bn with an underlying operating profit of £44m in line with the prior year.
Specifically the highways business performed well in the six-month period, benefiting from increased government focus on infrastructure maintenance. In December 2014, Northamptonshire County Council approved a £200m four-year extension of the highways services contract for Kier, together with its JV partner WSP.
The Lincolnshire highways contract was extended for one year until March 2017 at an estimated value of £37m. The firm’s East Sussex highways contract was extended until April 2016 with an estimated value of £15m. Discussions continue with a number of existing local authority clients and the Highways Agency remains a key opportunity for Kier’s highways maintenance business.
Chief executive Haydn Mursell said: “With improving economic conditions, and, notwithstanding pressures in the supply chain, our robust execution skills and delivery and disciplined approach to bidding and risk management continue to deliver good results.
“Now that May Gurney is fully integrated, we have a broad range of services across the Group and Kier is well positioned to work strategically with clients on how they can achieve their aims in light of financial challenges they face.”