Leadbitter looks set for buyout as rivals shun sale

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Major contractors express little interest in Oxford firm – with the exception of French giant Bouygues

Leadbitter Construction looks likely to be bought by its management after rival firms showed little appetite to bid for it.

The speculation follows news that Heijmans, Leadbitter’s Dutch parent, had put the Oxford-based business up for sale after releasing poor overall results.

The boss of one major contractor said: “It’s quietly been on the market for a while. I’m not sure who would buy them as they don’t do anything the rest of us can’t. It’s got a good reputation but it’s not big and not small, which is not a very good space to be in at the moment.”

A senior figure at a £1bn-plus turnover company questioned whether the company’s exposure to the education market was attractive. He said: “A year ago it would have been a different story. We’re highly unlikely to look at it now, though, given the doubts over education spending.”

Another source suggested it may be a target for French giant Bouygues, which operates in the south of England but is looking to expand into the Midlands. It is understood Bouygues ran the rule over Kent-based Denne Construction before it was bought by Leadbitter for £17m in 2006 and is now planning to examine Leadbitter. The company declined to comment.

According to one source close to Leadbitter, a management buyout is being studied by executives.

The source said: “There’s no rush to make a decision but the management could buy the company back rather than allow another group to take over. Raising the money shouldn’t be too much of a problem.”

Chief executive Bob Rendell owned the company before selling to Heijmans in 2003.

Leadbitter is set to make £10m pre-tax profit on turnover of £318m this year. However, Heijmans made a pre-tax loss of €16m (£14.2m) on turnover of €3.6bn (£3.2bn) last year..

Guus Hoefsloot, its chairman, stepped down in May last year after the housing slump and rising costs hits its profit.

In its results last week, the group announced a €100m (£88.5m) rights issue and a refinancing package with its lenders.

The Leadbitter story

Bob Rendell took over the business from his late father Frederick in 1985 when it was a housebuilder run out of a kitchen in Oxfordshire. It employed three people and turned over £300,000 a year.

It won a job to build 11 bungalows in Banbury and Rendell gave himself three years to turn the business into a bigger force.

It grew by about 20% year on year, maintaining its presence in housing and expanding into general contracting, eventually with a turnover of £318m.