Persimmon to name new boss as shares sink

SHARES in Persimmon tumbled yesterday as the embattled company prepared to install a new chief executive following a damaging row over fat-cat pay.

The stock was down 4.7pc, or 116p, to 2352p on suggestions the builder could be stripped of its right to participate in the Government’s Help to Buy mortgage scheme.

A source close to James Brokenshire, the secretary of state responsible for housing, told The Times he was ‘increasingly concerned by the behaviour of Persimmon in the last 12 months’.

Issues include the sale of houses with leases, the quality of Persimmon homes and treatment of customers, and its leadership in the wake of the backlash over pay.

The threat to bar it from Help to Buy is another headache for chairman Roger Devlin ( pictured), who could name a chief executive as early as today. Former boss Jeff Fairburn was forced out by Devlin at the end of last year following an outcry over his £75m bonus. Managing director Dave Jenkinson, 51, has been interim chief executive and is favourite to land the job. However, he also benefited from the bonus scheme that cost Fairburn his job, scooping £40m.

Persimmon relies on Help to Buy for around half its business and is set to become the first UK housebuilder to post annual profits of more than £1bn. The new boss will be keen to smooth things over with the Government ahead of a review that will decide the terms of Help to Buy from 2021.

And Devlin will seek to focus on Persimmon’s efforts to improve customer care when the company announces its bumper profits haul today. A housing ministry spokesman said: ‘This government wants to see more good quality homes that people are proud to buy and proud to live in. We expect all developers to deliver good quality housing, to deliver it on time, and to treat purchasers of new-build homes fairly.’ A Persimmon spokesman said: ‘ In late 2018 we announced a range of new customer service initiatives and we are confident that these will improve our performance once they have had time to take effect. We are also making a significant investment in training to address the shortage of skills in the industry.’ Russ Mould, at broker AJ Bell, said any move to stop Persimmon using Help to Buy would be ‘a damaging blow for the company’. Joshua Mahony, senior market analyst at IG, said: ‘It seems unlikely we will see Persimmon excluded from any future programme, with many of the issues broached by the Government being historical rather than current-day practises.’