Kier Group
Kier Group agrees to sell stake in Australian road maintenance division KHSA. Credit: Daniel Lee.

Kier Group has agreed to sell its shares in Australian road maintenance division KHSA to Downer Group in a deal worth around A$43.7m (£24m).

The transaction will be carried out in cash and is expected to be completed early next year subject to an escrow arrangement.

A Kier Group statement said: “KHSA, which was acquired as part of the Mouchel group of companies in 2015, provides road asset management and maintenance services in Australia in a joint venture with Downer.

“For the financial year ended 30 June 2018, KHSA reported a profit before tax of £7m. The gross assets of the company were £52.1m at 30 June 2018.”

“KHSA provides road asset management and maintenance services in Australia in a joint venture with Downer.”

UK-based infrastructure group Kier is aiming for a profit of around £15m from the deal, subject to post-completion adjustments.

The company will use the proceeds from the sale to further reduce its net debt and to focus more on its core market areas.

The divestment is part of the Future Proofing Kier (FPK) programme, which was launched by the firm in July with the aim of streamlining the business while generating more cash.

Kier currently employs around 21,000 people across its sites in the UK, Australia, and the Middle East.

Downer Group is mainly engaged in the design and development of infrastructure and facilities in Australia and New Zealand.