Jarvis chief's £500,000 pay-off

JARVIS chairman Paris Moayedi is to walk away with a pay-off of £520,000 after the driving force behind the rail engineering group today officially announced his departure.

He is being replaced by existing Jarvis director Steven Norris, who is likely to pick up around £100,000 a year for the part-time job that amounts to little more than a day a month.

Norris takes the chair in controversial circumstances as he is standing as the Tory candidate in next summer's London mayoral elections. If he is elected he will stand down at Jarvis. His replacement could be Jonathan Agnew, the former chief executive of Kleinwort Benson who was today recruited as a Jarvis non-executive.

Norris said: 'My priority will be to ensure the company regains its reputation.'

The management changes came as Jarvis reported pre-tax profits soaring by 77% to £33m in the six months ended September. They were buoyed by £12m of first-time profits from its Tube Lines venture running a third of the part-privatised London Underground. Profits were also boosted by railway upgrade work in the past year.

But the decision by Network Rail, the rail network operator, to take all its day-to-day maintenance work back in house will cost Jarvis about £17m in profits next year. As a result it is holding its interim dividend at 4.5p.

The company plans to claw back some of that lost income by entering the freight market.

The appointment of Norris means the company has n its fourth chairman in 15 months and comes after Jarvis' succession plans were accelerated following the death of chairman for just eight months Lord McGowan.

Moayedi's legacy is overshadowed by a track record of foul-ups that leaves Jarvis with one of the least credible reputations of any stock market company.

On the one hand Moayedi has built a company by anticipating where hundreds of millions of pounds of future contracts would be thrown around by a Labour Government - on the railways, in education and in health.

The company, however, remains under investigation over the fatal derailment at Potter's Bar. It was recently rocked by faulty track work leading to a derailment outside Kings Cross. It was also responsible for the maintenance of tracks at the Camden Town Tube derailment last month.

The company came under fire this autumn for operating failures that led to the delayed reopening of five schools under its care in the Wirral, Merseyside.

The one-time penny stock soared to more than 700p in 1999 but its credibility was hit by damaging disputes with rail unions and, in 2000, its one-time auditor PricewaterhouseCoopers which resigned after an accounting row.

The shares today opened at 234p, close to a 12-month low, having lost 40% of their value since July.

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