Mouchel blow as accounts delayed and chairman quits

Aaron Morby 13 years ago

The chairman of striken consultant Mouchel has resigned just a week after the chief executive Richard Cuthbert suddenly quit after serious accounting errors.

The ailing firm also revealed it was in talks with its banks about breaching covenants after issuung a profit warning last week.

While these negotiations continue Mouchel said it intended to delay reporting annual results until the end of November.

Shares in Mouchel fell sharply again to 12p, valuing the company at £13m.

Earlier this year Costain offered 153p a share, valuing Mouchel at £175m, which was rejected on grounds that it did not present long term shareholder value.

Chairman Bo Lerenius announced he was standing down from the board, as Mouchel revealed it had found a new chief executive to replace Richard Cuthbert.

Grant Rumbles, 53, takes over as chief executive today. He was formerly CEO of Exova, an international testing, advisory and assurance services business from 2008 to 2011.

Before that he spent 25 years with Serco Group where he held a range of senior management positions, culminating as the group chief operating officer for four of them.

Corporate recovery expert David Sugden, non-executive director brought in by Mouchel in January to strengthen the board, will take over as interim chairman.

Mouchel revealed that it was also holding talks with its banks regarding covenant breaches expected as a result of the profit warning last week.

This revealed that accounting errors and a review of expected contract settlements would see £8.5m wiped off expected profits.

A company statement said: “The board is encouraged that the banks have been supportive and the discussions continue to be constructive with the objective of providing Mouchel with a stable funding structure.

“In that context the banks have asked KPMG to provide them with a report to help them secure that objective.”

It added: “Mouchel has commenced discussions with its lending banks regarding covenant breaches which are anticipated to arise given the reduced profits highlighted in the trading statement.

“In view of the importance of these discussions the Board has concluded that it should defer the intended date of publication of the report and accounts for the year ended 31 July 2011, to 30 November 2011.”

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