Advertisement

Kier to sell off house-building business

One of the largest outsourcing firms in the country – the Kier Group – has announced plans to sell off its house-building business as it seeks to save £55m a year by 2021.

The firm announced yesterday (17 June) it is putting Kier Living, which specialises in affordable housing, up for sale because it has ‘limited operational synergies with other parts of the group’.

In a statement issued to the city, the group states it has received a number of ‘inbound expressions of interest’ in the business, which operates a number of joint ventures across the country.

The statement adds that last year, Kier Living completed more than 2,000 units and as of 31 December 2018 had 4,739 plots.

The Kier Group has a number of local government contracts spread across a wide range of difference services.

The statement also reveals that the board of the Kier Group also plans to exit or sell off other parts of the business, including Kier Property, which has a number of joint ventures, including Solum Regeneration with Network Rail and the Watford Health Campus with Watford Borough Council.

Instead, following a strategic review, the Kier Group will now focus on infrastructure, highways and utilities.

A number of large infrastructure firms have hit the buffers recently, including construction giant Carillion, which collapsed last year with debts of more than £1.5bn.

‘Since becoming chief executive on 15 April, I have visited many of our key locations and spent time with all of our businesses, meeting the leadership teams and many of our dedicated people in the process,’ said chief executive Andrew Davies.

‘I have also met with many of our clients.  Kier has a number of high-quality, market-leading businesses, in particular, regional building, infrastructure, utilities and highways.  I believe that these businesses will deliver long-term, sustainable revenues and margins and are inherently cash generative.

‘As previously announced, I have been leading a strategic review which has resulted in the actions being announced today.

‘These actions are focused on resetting the operational structure of Kier, simplifying the portfolio, and emphasising cash generation in order to structurally reduce debt.  By making these changes, we will reinforce the foundations from which our core activities can flourish in the future, to the benefit of all of our stakeholders,’ added Mr Davies.

Photo by DidbyGraham (Flickr)

Comments

Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments
Help us break the news – share your information, opinion or analysis
Back to top