In a statement issued this morning, Kier said “the rationale for the acquisition is compelling” and represents “an excellent opportunity to accelerate Kier’s plans for growth in the infrastructure sector”.

Mouchel is an international infrastructure and business services group. It provides advisory, design, project delivery and managed services to the highways and transportation, local government, property, emergency services, health, education and utilities markets in the United Kingdom, the Middle East and Australia. It is the leading provider of repair and maintenance services to the UK strategic road network.

The deal will create a new enlarged group with a combined order book of £9.3 billion, comprising Kier’s order book of £6.5bn and Mouchel’s order book of £2.8bn.

Kier expects to deliver £10m in annual cost savings, including £4.4m a year in corporate savings from reducing Mouchel’s board.

Kier’s chief executive, Haydn Mursell, who will become CEO of the expanded group, said: “The successful acquisition of Mouchel now positions Kier as a sector leader in the growing UK highways maintenance and management market. In particular, the acquisition enables the Group to capitalise on £17 billion of investment in the strategic road network to be delivered through Highways England over the next five years, whilst also accelerating the delivery of Kier’s ‘Vision 2020’ strategy.”

Earlier this month, Kier raised almost £312m from a share rights issue to help fund the acquisition.

Speaking when the initial deal was agreed back in April, Grant Rumbles, chief executive of Mouchel, said: “Kier and Mouchel are an excellent fit.

“The enlarged company will enable us to improve our offer to customers and to enhance the career opportunities of our employees.

“This deal is testimony to the successful turnaround of Mouchel following its 2012 restructuring. Refocusing the business on its core strengths and targeting profitable growth has brought us to a position where our order book is now more than £2.8bn.”