Mouchelappoints new chief as bank talks start

The ailing services group Mouchel has appointed a former Serco executive to turn its fortunes around, and has begun talks with banks over the impending covenant breaches.

The company announced yesterday it had appointed Grant Rumbles as its new chief executive with immediate effect a week after Richard Cuthbert resigned.

The group has started talks with its banks after predicting earlier this month that it would breach its covenants following a decline in profits. It has also called in accountancy group KPMG to provide a report to help secure an agreement.

The board said it was "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".

Mouchel's board said the importance of the discussions meant it would defer the publication of its full-year report and accounts to the end of next month. Mr Cuthbert announced his resignation last Thursday, after an accounting error forced the company to warn on profits. The statement saw the shares tumble by a third. Mr Rumbles spent 25 years at Serco, the last four as group chief operating officer.