Aggreko share price: Company appoints KPMG as new external auditor

Aggreko Plc (LON:AGK), the world’s largest temporary power and temperature control solutions firm, intends to end its 18-year relationship with PricewaterhouseCoopers next year. In a short statement to the London Stock Exchange today, the company said that it would recommend the appointment of KPMG as external auditor for 2016. Aggreko noted that it would seek shareholder approval for the change at its 2016 annual general meeting.The company has advised that PwC will continue in the role of external editor until the end of 2015.

Aggreko’s decision comes in the wake of new regulations in the UK, which compel organisations to put their audits out to a tender on a five-yearly basis. These regulations have led to significant changes in the UK audit sector, as many firms have replaced their traditional auditors, ending long partnerships in most cases.
For PwC Aggreko’s decision marks the latest in a series of losses. Over recent months, the auditor has lost contracts with John Lewis, Tesco and Sainsbury’s. From the Aggreko contract alone, the firm saw £262,000 in audit fees and £844,000 in non-audit-related fees last year.
In today’s trading, Aggreko shares were flat at 1,442.00p, as of 15:07 BST. The stock has fallen 4.1 percent since the start of the year, trimming the company’s market capitalisation to 3.7 billion.
The 17 analysts offering 12 month price targets for Aggreko have a median target of 1,461p, with a high estimate of 1,850p and a low estimate of 1,240p. As of July 10, 2015, the consensus forecast amongst 22 polled investment analysts covering Aggreko had it that investors should hold their position in the company. This consensus estimate has been maintained since March 05, 2015, when the sentiment of investment analysts improved from “hold”.
As of 16:02 BST, Monday, 13 July, Aggreko plc share price is 1,443.50p.