104-year-old contractor sells two more businesses as it refocuses on housing and regeneration
MJ Gleeson is set to focus on housing and regeneration as it further scales back its business.
Gleeson, which pulled out of the building sector last year, has put what is left of its engineering and concrete repairs business up for sale and is looking to housing to provide future growth.
Dermot Gleeson, chairman, also said the company was considering leaving the quoted construction sector and relisting on the alternative investment market, which is designed for smaller companies.
Gleeson has already sold its rail business, Gleeson MCL, to Morgan Sindall for £24m after Building first revealed the two companies were in talks, and last year sold its building business to the management team after making a £30.6m loss last year.
The changes were announced after a full review of the business. Chief executive Terry Massingham said that neither engineering nor concrete repairs sat well within the new business model.
Gleeson also revealed plans to sell its portfolio of commercial property investments and non-housing PFI investments.
Gleeson Homes will be scaled back to focus on regeneration, which in turn will lead to a sale of its non-strategic landbank.
Gleeson defended the decision to focus on homes and regeneration, despite the fact that that business made a £1.2m operating loss in the six months to 31 December, compared with a £2.2m profit the previous year.
Dermot Gleeson said: "It retains the potential to make substantial profit. The level of activity has seen a noticeable increase since Christmas, and housing regeneration schemes are expected to make a material contribution to the second half divisional result."
The regeneration business will sell houses mainly on local authority land and carry out maintenance and refurbishment for social housing providers. It also intends to carry out social PFI housing projects.
Gleeson has calculated that it could build and sell more than 7000 homes in the next 10 years.
Gleeson Properties, the commercial division, has 16 schemes in progress.
Castle Acquisitions, a venture capitalist that said in January it was considering making a £197m offer for Gleeson, has officially withdrawn its interest.