Carillion to replace temporary chief with new boss three months early

 
Oliver Gill
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New Carillion boss Andrew Davies was due to start in April 2018 (Source: Getty)

Ailing construction firm Carillion is to part company with its interim boss earlier than expected, with his permanent replacement ushered in three months ahead of time.

Keith Cochrane, who has been in temporary charge of Carillion since a crippling announcement last July, was set to hand over to Andrew Davies on 2 April 2018.

But the Wolverhampton-based firm today said Davies replace Cochrane on 22 January.

Shares in contractor rose by over four per cent in early trades.

Cochrane will remain with Carillion in an "advisory capacity" to ensure an orderly transition, the firm said.

Carillion's market capitalisation has recently slipped below £70m with its banks now expected to swap much of their £1bn plus debt pile for equity in the firm.

In the meantime, the firm is trying to flog assets and rake in cash in order to appease lenders, which have handed Carillion a £140m short-term funding lifeline.

The contractor originally hoped to raise £300m form non-core sales. Shares have continued on a downward trajectory after a number of big falls. Last week, Carillion was dealt a further blow after major investor Kiltearn Partners halved its interest in the firm.

Read more: Carillion’s banks were left on the sidelines while shares plummeted

Former Kier chief Cochrane was drafted in as Richard Howson was shown the door in July after Carillion revealed an £845m contract write-downs that ultimately grew to more than £1bn.

But the firm has been rocked by series of problems, which appears to have taken a rights issue from current shareholders off the table and led to analyst speculation that the only thing keeping the company afloat is the UK government's backing of the firm.

Carillion is contracted to deliver some of Britain's largest infrastructure developments, including the controversial HS2 project.

Read more: One of Carillion's biggest backers just revealed it sold a chunk of shares

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