U-turn sees company founder commit to another two years as chief executive

The man brought in to take over from Ray O’Rourke as boss of Laing O’Rourke is leaving the business after less than a year at the firm.

The country’s biggest private contractor confirmed the news this morning as it released its latest annual results which show a £76m hit at its Australia business dragged group profit down to less than £3m on turnover of £3bn.

But the figures have been overshadowed by the announcement that Seamus French, who only began work at the business at the start of 2022, and was supposed to take over from O’Rourke as chief executive last month, will now be gone by Christmas.

A Laing O’Rourke spokesperson said the company will “revert to the structure that was in place last year and Ray will work closely with the leadership teams in both [Europe and Australia] hubs”.

seamus french

Ray O’Rourke (left) greets fellow Irishman and would-be successor Seamus French on his first day at the business at the start of this year. But French will be gone by Christmas, the company said today

The firm said that O’Rourke will “continue as Group CEO and Europe MD for the next two financial years” meaning the contractor no longer has an obvious succession plan for a man who will be 78 by the end of its 2024 financial year.

Under a plan spelt out last November, when French was first announced as O’Rourke’s replacement, O’Rourke was due to step down at the end of this summer and join younger brother Des as a deputy chairman.

Last month, the company told Building French would still be taking over from O’Rourke saying that a public unveiling was on the cards but “details on handover…along with introductory interviews for Seamus haven’t been decided on”.

>> Also read: It’s hard to let go: Laing O’Rourke and the problem with succession

French, who has been a non-executive at Laing O’Rourke since May 2020, was appointed managing director of its £1.8bn turnover Europe hub, while being made chief executive-designate as well.

At the time of last November’s announcement, Laing O’Rourke said Ray O’Rourke would “focus on innovation, people development and major clients”.

But explaining the U-turn, the firm’s chairman Sir John Parker said today: “Since signing off the Group accounts for FY22, Seamus and Ray have been focussed on the challenges of completing a CEO leadership transition during a period of significant economic turbulence here in the UK. We have agreed to ‘hold formation’ and that Seamus will step down from his transitional role as Europe managing director with Ray remaining as CEO.”

French, who turned 60 in May and joined after 14 years at mining giant Anglo American where he was in charge of the firm’s bulk commodities and other materials division, said: “I have thrown myself into this role and found the industry tough but exciting and have grown extremely fond of the ‘can-do’ environment and personal engagement at Laing O’Rourke.

“However, my experience tells me it is better to allow the established team to flex and respond to the market at this time. I am available to assist the business in any way I can and I am grateful to the people of Laing O’Rourke for their support during my time with the company.”

In a statement, O’Rourke called French “a genuine friend” and said he had championed the firm’s efforts to “make our industry more respected, rewarded, sustainable and inclusive”.

Nonetheless, French is the latest in a string of a string of would-be replacements for O’Rourke who have come and gone since he bought Laing for £1 in 2001, notably Tony Douglas, the former boss of Heathrow Airport, now running Etihad Airways, who went in 2009, and Paul Sheffield, a former chief executive of Kier, who left O’Rourke after three years in 2017. Former chief executive Anna Stewart stepped down at the end of 2015 due to ill health and passed away five years ago.

It was widely assumed that French had been brought in to help ready the firm for a stock market listing after Ray O’Rourke told the Financial Times last September: “We will float the company in a few years’ time. By 2024 we will be in good shape.”

Commenting on French’s departure, one industry source questioned whether the firm would ever float and added: “Ray has some sensible people on his board who must be tearing their hair out. I think a float is years away, if it happens at all. I’m not sure the market is looking for another listed contractor.”

Once touted as a successor to his father, Ray O’Rourke’s son, Cathal, left his position as managing director of its £1.1bn turnover Australia division this spring but has since been appointed a non-executive of the business and succeeds him as chair of the division next month. The Australian business’s managing director Rebecca Hanley will also step up to the group board next month.