Disposal of business reduces debt and enables Gleeson to focus on housing regeneration work
Gleeson has sold its engineering division to US construction business Black & Veatch Corporation for £36m.
The move is in line with the firm's goal of becoming a housing regeneration company.
Commenting on the disposal chairman Dermot Gleeson said: “Now that it is sold, we can focus on an appropriately reduced infrastructure for the group going forward.”
Proceeds of the sale will be used to reduce the debts of the firm, which announced a severe profits warning in May.
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. The majority 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.
The sale included a cash balance transfer to Black & Veatch of £14.5m to compensate for the engineering division’s negative net assets. As a result Gleeson will receive £21.5m before tax.
Gleeson said that the sale would provide the division’s 950 employees with “significantly enhanced” career opportunities. He said: “I wish our engineering personnel, many of whom I have known for many years, the very best for the future.”
Gleeson said it expected to announce its results for the year ended 30 June 2006 on October 27.