Newspaper article The Journal (Newcastle, England)

Second Sell-Off in a Week for Troubled Mouchel

Newspaper article The Journal (Newcastle, England)

Second Sell-Off in a Week for Troubled Mouchel

Article excerpt

Byline: Iain Laing

BELEAGUERED infrastructure group Mouchel has sold its pipeline design business in its second disposal in five days.

The group, which has seen its share price tumble by 90% over the past six months, is selling the business to Croydon-based engineering group Mott MacDonald for pounds 2.55m plus up to a further pounds 850,000. The deal follows last week's disposal of its rail arm to Australian firm Sinclair Knight Merz for pounds 3.4m and a further pounds 2.5m in working capital.

Mouchel, which has seen two chairmen and a chief executive depart following another profits warning two weeks ago, said the money raised would go to pay off debts that stood at pounds 87.4m in July.

After the latest warning, Mouchel also said it was in talks with its banks as it was likely to breach the covenants on its borrowings.

New chief executive Grant Rumbles, who took over less than two weeks ago, said: "Following the recent agreement to sell Mouchel Rail, the sale of Mouchel's pipeline design business is another key step in our strategy to focus on Mouchel's leading positions in core markets. …

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