Speaking for the first time since P&O announced its plans to float the 114-year old construction management company, Sir Frank said: “My intention is to stay on as president. I will do what is right for Bovis, and work behind the front line to support the chief executive Luther Cochrane.” There had been speculation in the industry that 72-year-old Sir Frank would retire after the flotation.
“I am not immortal,” he said. “But we need as little change as possible at this time.” Sir Frank’s announcement also stirred up speculation that Bovis Construction will be listed on the stock market under support services rather than construction, and thereby secure a higher rating.
“We will be explaining our business to City analysts over the coming months,” he said. “It will be for them to judge from the nature of our business where we belong in the stock market.
“As a part of a FTSE 100 company, we suffered from a lack of attention from construction analysts, and this is something we have to put right.
“Bovis has a unique geographical and sectoral spread to its business. And we have many long-term, fee-based contracts that are more comparable to service contracts. But really, the analysts will have to make up their own minds where we belong.” The Bovis executive chairman also confirmed the group’s intention to go on an acquisition spree prior to flotation.
“We are talking to firms in the UK, USA and Europe,” he said. “These will not be deals on the scale of the proposed WS Atkins merger, and none will be a contractor, because we are not a contractor.” Sir Frank said Bovis staff would be given the opportunity to buy shares at the time of the flotation, and said he “thought it would make sense” for the company to be listed in New York as well as London, as almost half its business was now in the USA.
On 21 April, Bovis is set to hand over the first phase of the Venetian, a 3000-bedroom hotel in Las Vegas.
At $650m, this is the largest single contract it has completed in the USA.
Last week, Bovis announced a 30% rise in operating profit to £21m in 1998, and revealed its intention to float. Bovis was originally floated in 1928, and was delisted when it was bought by P&O in 1974.