Chairman tells top brass to expect more details on sale of Australian arm in May too

Ray O'Rourke

Laing O鈥橰ourke chairman Ray O鈥橰ourke has said he expects to have more details on the sale of its Australian arm in the next couple of weeks.

The firm hoisted the for sale sign over the 拢1.5bn turnover business earlier this year, signalling an end to a dozen years working in the country and the Pacific Rim.

The Australian arm was set up in 2004 but expanded rapidly three years later after the firm snapped up Barclay Mowlem from Carillion 鈥� after the latter decided to pull out of the region following its takeover of Mowlem the year before.

In an update to senior managers, O鈥橰ourke said the sale was progressing 鈥渋n line with expectations鈥� and promised there will be 鈥渕ore definition on the progress regarding the divestment of the Australia Hub鈥� at the beginning of next month.

Explaining the decision to sell up back in January, O鈥橰ourke said the firm had received approaches for the Australian arm from a number of bidders and added that proceeds from the sale will be used to fund 鈥渇urther UK investments [that] will be required especially in areas that promote our competitiveness and the attractiveness of our offering to clients鈥�.

Money will be also be ploughed back into expanding its off-site manufacturing arm which is based at Steetley in Derbyshire.

O鈥橰ourke鈥檚 update to senior staff also revealed that it had struck a deal with its banks to strengthen its balance sheet. He said the firm had rubber-stamped a new business plan and added: 鈥淲e also completed an extensive process of sharing this plan with our financial stakeholders. These stakeholders have shown significant support for our business plan by agreeing additional medium term facilities through to October 2018 reflecting their confidence in the direction of the business.鈥�

Around 200 staff are expected to leave in the coming weeks after the firm announced a major restructure at its UK business, the details of which O鈥橰ourke said would also be revealed in early May. He added: 鈥淭he key drivers remain a clear focus on securing major projects and strategic frameworks, improved productivity on our projects, all of which is supported by an efficient overhead cost base.鈥�

The firm has been hit by a number of high-profile departures in recent months with chief executive Anna Stewart stepping down just before Christmas, while infrastructure director Gary Wells 鈥� who has since been replaced 鈥� also left before Christmas. This week it was announced that its major projects boss, Jonathan Goring, had quit after just three months and was moving across to Morgan Sindall to head up the contractor鈥檚 affordable housing business, Lovell.

 

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