Heads of road division and track renewal believed to have been made redundant as part of wider restructuring

Jarvis showed further signs of strain this week as two senior directors were made redundant.

Bob Doyle, chief executive of the roads division, and Richard Davies, head of track renewals, are understood to have left last Friday.

It is believed their jobs were axed in a cost-cutting drive.

In a separate development, Brian Wise, who was head of the Jarvis control centre, which oversees Jarvis’ rail work, also quit the firm. Jarvis declined to comment on his departure.

The company is planning to close its headquarters in York and move to smaller offices in the city.

Under Alan Lovell, the new chief executive, Jarvis is trying to salvage what is left of the business and intends to focus on its rail, road and plant hire divisions. It is understood that the departure of Doyle and Davies is part of that restructuring.

Last week Vinci walked away from a deal to buy Jarvis’ PFI business. It had been in talks to take over schools contracts in Northern Ireland, Manchester and Cork, on which Jarvis was preferred bidder.

It is understood that Vinci withdrew from the deal because it could not afford to do the work for the price that Jarvis had agreed.

Jarvis is now in talks with German company Hochtief to take over the three contracts but details.

It is thought that Vinci is still in negotiations about other education projects where Jarvis has started work, in Exmouth in Devon, Lancaster, Croydon in Surrey, Nottingham and Rhonda in South Wales. It is also understood that as part of a contract agreed between Jarvis and Haringey council in north London, the council has agreed to guarantee payment to subcontractors in the event that Jarvis is not able to pay.

Jarvis is also keen to sell its facilities management business and reduce its £230m debt.

The cuts in the workforce and cost base reflect the scale of the financial problems at Jarvis.

On Monday, shareholders voted in favour of changing the way the company’s total debt was calculated. This would allow the firm to exclude cash tied up in Tube Lines, the London Underground consortium, from its total debt.

A spokesperson said that the move would give the firm more flexibility to change its debt level while it continued its asset disposal programme.

Last week the company admitted that it had increased expenditure by an unbudgeted £80m.