The chief executive of troubled National Express is to quit amid spiralling debts and the sudden halt to the £15 million redevelopment of Digbeth Coach Station.
Richard Bowker, who joined the Birmingham-based group in 2006, will leave at the end of August to take up a new role as head of Union Railway in the United Arab Emirates.
His departure comes as the firm failed to agree a deal with the Department for Transport over its East Coast rail franchise, which is expected to lose more than £20 million during the first half of this year.
The company has failed to agree a renegotiation of the deal – agreed on over-optimistic assumptions before the recession – with the Department for Transport.
Transport Secretary Lord Adonis said today the Government was now to take over the running of the East Coast Line through a publicly-owned company when National Express East Coast ceases to operate.
Meanwhile, the group’s Digbeth project has been stopped in its tracks after the main contractor on the prestige project suddenly ceased trading amid crippling debts.
National Express has been forced into an emergency contingency plan with the appointment of a new contractor to replace cash-stricken Ashford Construction.
The transport giant was today continuing to insist that the new coach station would re-open as planned in November 2009 - but has not named the new contractor.
But Great Barr-based Security Network UK Ltd - which is owed £40,000 by Ashford Construction for four months’ work - said the site gates had now been closed following the announcement of the firm’s demise.
The new £15 million coach station facelift is seen as a major catalyst in the overall regeneration plan for Digbeth and the whole of the Eastside district.
But days after National Express said the new station would open as planned, the Coleshill-based firm announced it was to go into administration.
The long-established North Warwickshire building firm - part of the Old House Holdings group - confirmed the move in a statement.
The statement said: “It is with great sadness that Old House has to announce that its subsidiary Ashford Construction has had no option but to cease trading. The board and its advisers are taking steps towards appointing administrators.
“Rapidly declining workload and little sign of any pick-up in inquiry levels has left the directors with no options.
“The group is reviewing various restructuring alternatives with its advisers with the aim of securing the future of some of its subsidiaries.”
National Express said in a statement: “We have been in discussions with another main contractor to complete the redevelopment of Birmingham’s new coach station and we will provide an announcement shortly.
“As previously said, the new Birmingham coach station will open as planned in November 2009.”
A spokeswoman for site security firm Security Network UK Ltd said: “The gates to the site have now been shut and there are no deliveries taking place. Nothing is going on the site, or coming off it.
“But we hope that this is only going to be for a very short period of time - we understand that National Express has somebody else lined up to take over as contractors.”
Ashford Construction was named as contractor for the Digbeth project in July last year. The firm’s £8.6 million redevelopment forms part of an overall £15 million investment by National Express, which is currently using a temporary coach station in Oxford Street.