MJ Gleeson has sold its civil engineering business to US construction giant Black & Veatch for £36m, following a four-month sale process, which also saw Balfour Beatty vying for the division.
The £200m-turnover business specialises in water-related construction, which is also the main focus of Black & Veatch’s activities in the UK. Gleeson will use the proceeds from the sale to reduce debt.
The sale is part of Gleeson’s plans to focus on housing regeneration and dispose of non-core businesses. The restructuring is part of the management’s plans to improve profitability.
Since the restructure was announced, Gleeson has been busy selling off other parts of its business. Last year Gleeson disposed of its construction division and earlier this year it sold its railway engineering business Gleeson MCL and Concrete Repairs, a specialist structural renovation business. Most of its commercial property portfolio was sold in June.
The engineering division generated £2.8m profit for the year ended 30 June 2006 and had gross assets of £40.1m and net cash of £21.1m. Gleeson said the sale provided the division’s 950 employees with “significantly enhanced” career opportunities.
The acquisition more than doubles the size of Black & Veatch’s UK water operation, which now has nearly 2,000 employees. Tony Collins, managing director of the UK water business, said: “The two organisations have complementary alliances and skills. The aim is to have one business by September 2007.”
Postscript
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