SHARES in Kier Group tumbled by more than 12 per cent after the troubled infrastructure giant was forced to revise its debt position by £50.5 million.

The company told the City that it had altered its net debt position at December 31 to £180.5 million from £130m, as previously signalled in a trading update on January 22. Kier said it has revised the classification of debt associated with certain development assets held for resale at December 31. This debt balance, totalling £40.2m, was originally consolidated within assets held for re-sale on the group’s balance sheet. The debt, following the re-classification, has now been included in the net debt position. Kier also had identified a number of adjustments relating to its hedging activities, totalling £10.3m.

The move to revise the company’s debt position comes after it launched a £250m rights issue to reduce its debt and strengthen its balance sheet late last year. However, nearly two-thirds of investors snubbed the capital raise, leaving a syndicate of banks nursing a £100m headache. Shortly after, it parted company with chief executive Haydn Mursell.

David Madden at CMC Markets said: “In late November 2018, the company launched a rights issue because it was concerned about banks unwillingness to lend to the construction sector. The latest debt fiasco has rocked investment sentiment further. The stock has been in decline since September, and a break below 400p might bring the 335p area into play.”

Kier said: “Whilst the board notes the current political and economic uncertainty in the UK, and the implications for third party investment, the group remains on course to meet its underlying FY19 expectations.”

Kier was working on the restoration of Glasgow School of Art when it was hit by fire for a second time last year. It had been the main contractor on the restoration of the Mackintosh Building after it first went on fire in 2014, and had made significant progress before the second blaze. Shares closed down 59.8p at 437.4p.