Incoming chief executive says basic plan for integration will be ready soon
A basic plan for the integration of contractor Keepmoat with former rival Apollo will be ready in a “small number of weeks”, incoming chief executive Ian Sutcliffe said this week.
Sutcliffe assumed control of £700m turnover Keepmoat this week after chief executive David Blunt stepped down, just weeks before the merger between the two housing contractors is set to go ahead.
The Competition Commission gave the proposed merger the green light in December and Sutcliffe, a former managing director of Segro and UK chief executive of Taylor Wimpey, said the legal completion of the deal would also happen in the next few weeks.
Sutcliffe said: “My first priority is pulling together the board to agree the shape of the merged businesses, so we get the best ideas, practices and people from the two firms.”
Sutcliffe was in charge of George Wimpey when it negotiated the £5bn merger with Taylor Woodrow in 2007. “I’ve been through a number of mergers and acquisitions in my career and thing that’s key, for staff and the businesses going through that uncertainty is to ensure there’s clarity as quickly as possible.”
Sutcliffe said he would be taking a twin process forward, with the completion of the legal merger set alongside the development of plans for the shape of the future business, which will be based in Doncaster.
Keepmoat’s ultimate holding company, Lakeside 1, fell to a £50m paper loss in 2011, after accounting for the interest on the loans used to buy the business in the credit crunch.
However, the operational business made a profit of £70m and Sutcliffe said this week he was attracted to lead the group because of the strength of the underlying businesses.
He said: “What I found in my initial due diligence was that these are very solid businesses, with a strong commercial sense and good values. These are not problem businesses. Putting Apollo and Keepmoat together is a great opportunity for two plus two to equal five.”
The combined businesses will have a turnover in excess of £1bn.