Kier May Fall Into Hands' Hands

A typical Kier Living development.

Massive construction firm Kier could be forced to sell off its house building arm to Terra Firma - the private equity company run by Guy Hands.

The Kier Group has been employed on contracts by the UK government and overseas but like Carillion and Interserve before it, the company has struggled with profitability and has been keen to divest parts of its business to focus on its core offering (major contracts and infrastructure) and to raise bailout funds. The Groups financial results out soon are expected to tell a sorry tale.

The house building division is call Kier Living. Hands could get his hands on it within weeks. Terra Firma is renowned for buying businesses, turning them around and then selling them on in short order. The company led a consortium in October 2018 to buy a Nordic modular school building company - and sold it off within 16 months at big profit having invested 200 million Euros in the project.

Alternatively Kier could raise funds via a share issue of up to £145 million - but in the current climate that may not stimulate investors. It is more likely that Hands offer up to £120 million for Kier Living. With the government keen on pushing forward with UK house building, Hands and Terra Firma could make a killing.       

Picture: A typical Kier Living development.

Article written by Cathryn Ellis
07th April 2021

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