More details of how sale is progressing expected when annual results released this Thursday
The management at Kier’s up-for-sale housing business is one of the groups to have submitted a bid to buy the £374m turnover business, Building understands.
The division was put on the block in June after new chief executive Andrew Davies (pictured) said the business, which is this week expected to reveal that it has increased the number of homes it built in the past year to around 2,300, was no longer a core part of the group.
Kier is due to release its latest annual results for the year to June 2019 on Thursday with the firm set to give a further update on the progress of the sale.
Tony Williams from consultant Building Value said: “It’s entirely possible it could go to the management. There is a lot of a private equity out there looking for a home. But whoever’s giving them the money will drive a hard bargain.”
Bovis Homes is also understood to have submitted a proposal in the first round of bidding although its interest is believed to have cooled now that it is in negotiations to snap up Galliford Try’s Linden Homes arm along with its regeneration business.
One source said: “I can’t see them sticking with the Kier bid now they’ve gone public about Linden.”
A number of housing associations are also understood to be interested, attracted by the firm’s affordable housing operation which in the year to June 2018 had revenues of £199m – the majority of Kier Living’s business.
Announcing plans for its disposal earlier this summer, Kier said the sale would help it make inroads into its debt pile. In a trading update last month, the firm said its average month-end net debt for the 2019 financial year was £422m.
In the update, the firm said it had received “significant interest” in the Kier Living arm which improved operating profit 14% to £26m in the year to June 2018.
Kier Living is now headed by managing director Nick Moore after executive director John Anderson, who had been with Kier for more than nine years, left the business at the beginning of July.
The business employs around 550 people and operates from five regions with bases including Leeds, Solihull and Marlow in Buckinghamshire.
Kier said it didn’t comment on speculation but added: “We will update the market when there is an update to share.”