It's been all Blitz spirit at Serco after its chief exec Chris Hyman departed in October (nothing at all to do with a Serious Fraud Office investigation into the company and not one but two profit warnings in November and January). But things have clearly got so desperate for the outsourcing company that it hasn’t just called in the cavalry – it’s recruited a Churchill.
Rupert Soames (who is, to put it politely, the polar opposite of the super-fit taciturn Hyman) announced today he will leave FTSE 100 company Aggreko after 11 years in the top job to join the embattled outsourcer in June. The grandson of Winston Churchill is no stranger to complicated projects – Aggreko is the largest temporary electricity generator in the world, powering everything from the London Olympics to Glastonbury and most of Japan post-tsunami.
Serco is just about everywhere in the UK, training the army, inspecting schools, keeping our nukes shiny and stopping prisoners from escaping. However, the FTSE company ran into a spot - nay, a thicket - of bother last year when it was banned by the UK government from new contracts after being accused of fraudulently overcharging ‘tens of millions of pounds’ for electronically tagging criminals.
Serco announced the obligatory ‘corporate renewal programme’ and struck a £68.5m settlement with the government over the scandal in December, which allowed the company back into its contractual fold the next month.
However, the next furore is never far around the corner for outsourcers, which makes it a somewhat odd move for Soames, who will be lucky if he makes it through a stint at the top of Serco with his reputation intact. Serco’s market capitalisation is also £2.2bn, almost half that of Aggreko’s £4.2bn.
Soames is something of a maverick, though – he netted £10,000 profit by running nights at Mayfair club Annabel’s during his final year at Oxford. The outgoing Aggreko boss is probably relishing the challenge, then, as well as getting paid a tidy packet.
Investors think he's up to scratch too. Serco’s shares were up more than 10% in mid-morning trading, while Aggreko’s fell more than 3%. Never underestimate the importance of a strong leader.