European firms said to be in the running for contractor as Liming jumps ship for Carillion
Mowlem lost a key executive this week as it revealed that it had received a takeover approach.
Liming is head of the construction division at Mowlem Projects, the company’s national building business, and therefore in charge of all large construction schemes, including PFI and traditional building contracts worth more than £25m.
Liming was unavailable for comment but a spokesperson for Mowlem said: “I can confirm that David Liming will be leaving the company in early 2006.” His successor has yet to be appointed.
Liming’s departure comes as rumours continued to circulate about the identity of a mystery bidder that approached the firm on Monday.
Mowlem said: “The board of Mowlem plc notes the recent movement in its share price and confirms that it has received a preliminary approach, which may or may not lead to an offer for Mowlem.
“The board, which is being advised by Rothschild, wishes to stress that discussions are at a very early stage and there can be no certainty that this approach will lead to an offer for Mowlem.”
Sources close to the process continue to predict that the takeover will come from a European contractor eager to get involved in the UK market, particularly in lucrative PFI projects. German contractors Bilfinger Berger, and Hochtief, and French contractor Vinci have been mentioned as potential buyers.
In April last year Bilfinger Berger shed 90 staff as part of a reorganisation of its British operations in order to focus more on large-scale PFI work, particularly large PFI infrastructure projects.
There can be no certainty this approach will lead to an offer for Mowlem
Sources close to Mowlem understand that Vinci, Europe’s largest contractor, is the most likely to table a bid. However, a source close to Vinci denied that any such approach had been made.
Building revealed two weeks ago that Vinci’s UK directors were keen to buy Mowlem but the idea has been rejected by the French board, led by chairman Philippe Ratynski. It was thought that the UK board would review the position early next year, once its French counterpart had completed other deals. It would also give Mowlem’s share price time to fall.
Contractor Laing O’Rourke has also been mentioned as a bidder, but one senior construction source ruled the firm out as a realistic buyer, even though it would be interested in Mowlem’s facilities management arm. He said: “I would have thought that from Laing O’Rourke’s point of view there was not much that it would want to pick up. A bid from Vinci makes much more sense.”
Mowlem’s reputation has suffered because of high-profile embarrassments such as the row over Bath Spa and a malfunctioning glass lift at the Spinnaker Tower in Portsmouth. The lift stalled for several hours in full view of guests invited to celebrate the opening of the multimillion-pound project, which overran its budget and missed its deadline by five years.
Mowlem called in financial consultant NM Rothschild to advise it in the wake of a £70m loss on contracts.
Chief executive Simon Vivian said at the time that Mowlem had not ruled anything out. This could include selling off parts of the business.
Mowlem’s share price stood at 195.7p as Building went to press.