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Kier FD reveals acquisition plans

Kier has its eye on a number of acquisition targets including a large support services firm and smaller infrastructure companies, its finance director has revealed.

Haydn Mursell spoke to Construction News after Kier posted a strong trading update to the City on Monday, reporting a construction profit margin above 2 per cent.

The Bedfordshire-based contractor said it had secured places on health frameworks across Wales and Scotland, and was bidding for more than
£1.5 billion-worth of UK infrastructure schemes.

Mr Mursell said an expansion of Kier’s support services offering could come through acquisition.

He confirmed that it had a large company “in its sights”. “We are very active in looking for opportunities to grow,” he said.

“We might have to buy something that is support services with a FM component.

“If there’s a small player that can bolster infrastructure, that would [also] help.”

Mr Mursell said shareholders were expecting Kier to make a move soon, and added that the cash was not earning much interest sitting in the bank.

“[Our acquisition activities] are all at different stages - some of them are at enquiries stage, some more developed - and across a variety of sizes,” he said.

Kier, which bought Stewart Milne’s construction contracts earlier this year, had £130 million in the bank at its interim management statement in May.

The company is expecting construction margin to be between 2 and 2.5 per cent this year.

Kier said it had 85 per cent of its target workload for 2013 either secured or probable.

 

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