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Outsourcer Serco's CEO Soames to step down at end of 2022

·2-min read
Rupert Soames, CEO of Serco Group Plc poses for a photograph at their offices in London

By Aby Jose Koilparambil

(Reuters) -British outsourcing group Serco said on Monday long-standing Chief Executive Rupert Soames will step down at the end of December, sending the company's shares down around 7% on Monday as it also named an insider as successor.

Soames, grandson of former British Prime Minister Winston Churchill, joined the outsourcing group in 2014 and led Serco through a multi-year turnaround plan after a string of contract problems. (https://reut.rs/3DhSZVG0)

The 63-year-old Soames was also at the helm during the coronavirus pandemic when Serco benefited from being one of the suppliers supporting Britain's test-and-trace programme.

"It has been the privilege of my working life to lead Serco for the last eight years, but it is now time for me to outsource myself," said Soames, who will retire from the company next September.

Shares in Serco, which provides defence, security, immigration, health and transport services for governments in more than 20 countries, have declined more than 41% during Soames's tenure but the stock has gained about 28% since mid-2020.

The company raised its annual profit forecast and dividend last month, helped partly by more immigration contracts in Australia and the UK in the first-half period.

Soames will be succeeded by Mark Irwin, head of Serco's UK & Europe division. Irwin, 57, joined Serco almost a decade ago and successfully ran its Asia-Pacific region, before moving on to his current role.

Liberum analysts in a note said they expect some investors to be "inevitably disappointed" by Soames's departure, but they see Irwin as "a safe pair of hands".

Prior to Serco, Irwin held leadership roles in several private-equity portfolio businesses and worked for U.S.-based industrial conglomerate GE .

Serco Chair John Rishton said Irwin's "deep knowledge" of the company and his prior experience in the U.S. made him "the ideal person to lead the group".

(Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Sherry Jacob-Phillips and Ed Osmond)