Buckingham Group's rail business bought by infrastructure giant Kier for £9.6M
UK infrastructure giant Kier has bought the rail division of Stowe-headquartered Buckingham Group Contracting Limited (Buckingham) for £9.6 million in cash after the latter fell into administration.
The deal includes Buckingham’s HS2 contract and reportedly saves around 180 jobs.
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Andrew Davies, CEO of Kier Group, said: "We have previously stated that we would consider value accretive acquisitions in core markets where there is potential to accelerate the medium-term value creation plan.
"This acquisition is one such example - it is an excellent strategic fit and accelerates our rail strategy, providing work with new rail clients and increasing our capabilities. I am delighted to welcome our new employees, clients and suppliers to Kier."
On August 17 this year, the Buckingham board announced that "rapidly escalating contract losses and a sharp reduction in liquidity" meant it was unable to continue trading and was filing a notice of intention to appoint administrators.
"Very strong delivery and commercial performance across most of the business has been outweighed by deep losses and interim cash deficits incurred on the three major Stadium and Arena contracts, and a substantial earthworks contract in Coventry," it added.
"This situation on these four long term major projects developed through a combination of unexpected impacts such as the extreme inflation linked to the Ukraine conflict and other challenges in the Sports and Leisure division."
Buckingham is the contractor behind Liverpool FC's Anfield road extension.
Grant Thornton was appointed administrator of the £700-million turnover group and reportedly 446 employees have been made redundant after no buyer for Buckingham's building, civil engineering, demolition, major projects and sport and leisure operations was found.
The Kier board said that given the "modest size" of this acquisition, it did not believe it would "materially impact" the group's forecasts for full year 2024 or its year end or average net cash position.
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