Contractor backs out of EDF deal at last minute as Australian parent decides to shun ’unethical’ work
Bovis Lend Lease has had to pull out of a nuclear deal with EDF energy at the eleventh-hour after parent company Lend Lease objected to working in the sector.
Bovis identified the nuclear new build sector as a target market 18 months ago, and it has emerged that the company had been lined up to work alongside Mace on a consultancy deal for EDF, to which Mace was appointed about six weeks ago.
But it is understood that the Australian Lend Lease board told Bovis to pull out shortly before the deal was to be signed because it does not want to be involved in the sector for ethical reasons. The Australian government has already decided not to pursue nuclear new build.
The decision, which Building understands was taken within the past few months, will rule Lend Lease out of a market that is expected to be worth up to £40bn in the UK alone. The size of the EDF deal has not been disclosed, but it is believed that Mace has about 100 people working on the contract.
We had an agreed business plan and the decision not to pursue nuclear is disappointing
Nick Pollard, Bovis Lend Lease
News of Lend Lease’s stand comes in the week that Bovis confirmed that chief executive Nick Pollard is to leave the business after less than two years in charge, as revealed by Building.co.uk. However, it is understood that Pollard’s departure was discussed before the nuclear question came up, and the issues are unconnected.
On the nuclear strategy, Pollard said this week: “We had an agreed and signed-off business plan to reposition ourselves in two or three new markets, and we said openly we’d examine rail, waste to energy and nuclear.”
“In the first two, we have enjoyed some success. In nuclear, we had some constructive dialogue, but I am not at liberty to disclose who with. On reflection, earlier this year the company decided this was not a sector it felt it appropriate to pursue. That is disappointing, but we respect that decision.”
Pollard will leave the business within nine months as part of a shake-up that was begun in April with the appointment of Dan Labbad as chief executive for Lend Lease in Europe. This meant Bovis and the other UK businesses, including PFI operation Catalyst, were brought under his control rather than reporting to Australia. Labbad previously headed up Lend Lease’s development business in Europe. He is also chairman of the UK Green Building Council.
Rather than replace Pollard, the company will recruit at managing director or construction director level. In the meantime, Pollard will be acting managing director.
He said: “In an age of austerity, it’s probably a good time to add value by integrating the businesses. That’s a direction that we’ve been discussing at senior level since the turn of the year.”
“As a consequence of that, you have to ask yourself whether you want two sheriffs in town, and the answer is no. It’s logical. Am I sad? Yes, of course, but I’m paid to serve the shareholders.”
The UK wants to build 10 reactors on five sites in the next 20 years
- The estimated market value of this work is £40bn
- 64,000 man years of work will be generated by the programme
- EDF wants to build four reactors at Hinkley Point and Sizewell
- A 2009 report by the Nuclear Industry Association said the UK industry had the capability to build 70% of what was required for nuclear new build
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