Kier shares plunge as it finds another £50m debt

JUST three months after Kier’s rights issue flopped, shares plunged again as it revealed its debts are £50m bigger than previously reported.

The construction group blamed the mistake on an accounting error, and has upwardly revised its net debt as of December 31 from £130m to £180.5m.

At the same time, Kier said it is expecting to take a £25m hit this year because of delays on its contract to redevelop Broadmoor Hospital in Berkshire.

Shares fell by as much as 18pc in early trading.

They later closed down 12pc, or 59.8p, at 437.4p, wiping out most of the stock’s recovery since early January and knocking £97m off the value of the business.

Kier said it remains on track to meet expectations for the full year, but warned Brexit uncertainty is making it harder to get backing from lenders.

That was a far cry from the cheer surrounding challenger banks Charter Court Financial Services and Onesavings Bank, however, which soared after confirming plans for a £1.6bn tie-up.

Analysts said the buy-to-let lenders complement each other well and a combination could allow them to make significant savings.

If the deal goes through, the new business will be 55pc owned by Onesavings shareholders and led by its boss Andy Golding.

The potential merger comes amid a flurry of deal-making in the challenger banking sector, with CYBG buying Virgin Money and First Rand taking over Aldermore last year.

Charter Court shares jumped 11.2pc, or 34.2p, to 340.6p after the announcement, while Onesavings rose 10.9pc, or 40.4p, to 410.4p. In more takeover drama, doorstep lender Provident Financial hit back at a hostile bid from rival Non-Standard Finance.

NSF has set out details of its proposal, including plans to pay as much as £22.3m in fees to its investment bankers and other advisers. Its scheme has backing from three shareholders who own almost 50pc of Provvy stock between them.

But the Provvy said the proposals will leave most shareholders worse off and could de- stabilise the business. This is because the takeover values the firm at current market prices, meaning investors will get no profit if it goes through.

Patrick Snowball, chairman of the Provvy, said: ‘The information in NSF’s offer document does nothing to change the board’s view that the offer is not in the interests of all shareholders and lacks both commercial logic and regulatory understanding.’

If the battle is won by NSF – which is led by the Provvy’s former boss John Van Kuffeler – then it plans to sell its rival’s car finance arm, Moneybarn, and shut or sell its payday lender Satsuma.

Provvy shares rose 2.2pc, or 12.4p, to 570p, while NSF shares edged up 0.7pc, or 0.4p, to 59.6p.

Cairn Energy, meanwhile, plunged 11pc after it admitted its four-year bid to claw back more than £1bn from India’s tax authorities has been delayed again.

The oil and gas company’s legal challenge has become a victim of bureaucracy, with the arbitration panel that has been charged with making a decision not expected to report back until late this year at the earliest.

Its guidance is a blow to Cairn, which argues that India’s decision to retrospectively tax it for a reorganisation of its business in 2006 was unfair. The announcement sent the firm’s shares down 11pc, or 21.5p, to 174.7p.

The FTSE 100, meanwhile, edged up 0.4pc, or 26.31 points, to 7130.62, while the FTSE 250 gained 0.2pc, or 45.39 points, closing at 19,093.06.