Enterprise cuts back £70m social housing business

Support services giant Enterprise is downsizing its social housing business, amid speculation about the direction of the £1bn turnover company.

The news comes the week after Building.co.uk revealed Neil Kirkby, Enterprise’s chief executive, has gone on gardening leave in advance of departing.

The chairman of the formerly-listed firm, Owen McLaughlin, is thought to be acting chief executive.

Enterprise has let a number of its social housing customers know in the past two months that it is aiming to leave its contracts, according to several industry sources, including customers of the firm.

Sources said the firm, which is thought to bring in about £70m a year in social housing revenue, was hoping to exit all but two contracts in the sector, which was hit by Rok and Connaught’s collapses last year.

One industry source said: “We’ve been told the firm is pulling out of social housing, and some of their staff have approached us for work. They’re looking to hold on to their Liverpool and Barking & Dagenham council contracts, but other than that the word is they’re removing themselves.”

The company denied it was leaving the sector, but refused to comment on whether its strategy had changed. It said in a statement: “Enterprise has long-term contracts and relationships with social housing providers that are very successful for all of the parties concerned and has recently won new work in the area.”

Last week, two separate sources close to the 13,000-strong company said that Kirkby has been on “gardening leave” and that McLaughlin has taken over temporary executive control. It is not known if his departure is linked to the reassessment of the firm’s social housing portfolio.

Kirkby was finance director when McLaughlin led a £490m management buy-out backed by 3i in 2007. Kirkby was promoted to the top job in 2009.

A spokesperson said: “The company is not prepared to make any comment [on management changes] at this time.