Speculation had been rife that Staples would be asked to step down after a torrid 2002 for the support services group. Under Staples' leadership last year Amey lost 90% of its market value and posted two profit warnings.
Vultures have been circling Amey since December. Speculators in the City started buying large chunks of the company in the autumn in the hope it would break up, and there have been persistent rumours that American engineer Bechtel would move in for a takeover.
Amey is hoping that its involvement in the part-privatisation of the Tube will help it get back on its feet. Amey, Jarvis and Bechtel form the Tube Lines consortium, which on Tuesday signed a deal with the government to upgrade part of the London Underground over a 30-year period.
The consortium said this week that the earnings from improving the Jubilee, Northern and Piccadilly Lines could rise to £2bn over the life of contract. Amey claimed that pre-tax profit would be boosted by £8m in the first full year of the deal.
But Amey's share in the consortium's future profits is not yet certain. It sold its £60m stake in Tube Lines to Jarvis and Bechtel last month because of its precarious financial position, and it only has until June to sort out its finances and buy the stake back. The news that Amey would be writing off £95m to reflect poorly performing assets will not have filled investors with confidence.
Staples' departure will be something of a blow to the government – as well as heading up Amey, he was also the chairman of the Tube Lines consortium. It is acutely embarrassing for Labour that there is effectively no hand on the tiller of the first private consortium to take over the part of the Tube.
Liberal Democrat London spokesman Tom Brake said the situation puts a question mark over the viability of the PPP system, and he called on the government to explain how it would cope with the possible financial collapse of a company involved with the Tube PPP.
For now, however, Amey is safe and the firm is in a good position to bid for a range of Tube services such as track renewal work, signalling and facilities management. Whether it can fend off hostile bidders before the money starts rolling in will be down to the business acumen of its next chief executive. Amey should make sure it hires the right person for the job.
