£180m-turnover housebuilder fails to find a suitable buyer
Scottish housebuilder Stewart Milne has gone into administration after a sale process failed to find a suitable buyer.
The Aberdeen-based company was put up for sale in April 2022 but it put the process on pause eight months later citing “uncertainty in the market” after Liz Truss’ mini-budget.
It re-started the sale process last August after recording a pre-tax profit of £16.5m on reduced turnover in the year to October 2022, partly due to the sale of its timber frame business.
But it was announced on Monday that Teneo had been appointed as administrators for the group, which has offices in Aberdeen, Edinburgh, Glasgow and Manchester and employs around 1,000 people including subcontractors.
“The downturn in the UK housing market combined with an extensive sales process not resulting in any viable offers has ultimately led to the need for the directors to place Stewart Milne Group Limited and some of its subsidiaries into administration, regretfully with some immediate redundancies,” said Teneo director Adele MacLeod.
Teneo said 217 jobs would be affected, with 54 retained to assist the process.
Stewart Milne, the former Aberdeen FC chairman, who founded the firm in 1975, said he was “devastated” by the development, which he described as a “totally unexpected outcome of the sale process”.
“[I am] struggling to accept it, given the profound impact it will have on employees, sub-contractors, suppliers and customers,” he added, claiming that there had been a bid for the company which he thought to be viable.
>> Stewart Milne sale back on as housebuilder returns to profit
“Stewart Milne Group was up for sale and, following significant interest, two bids were submitted,” said Milne.
“The bank has not accepted either bid and withdrawn its funding which left the directors with no option but to appoint administrators.
“I tried everything I could to find a way to achieve a better outcome for the business and the people who depend on it.
“I believe one of the bids could have delivered a comparable, financial return to administration and, crucially, allowed the business to continue to operate, safe-guarding hundreds of jobs and protecting livelihoods.”
Teneo’s MacLeod added: “We continue to assess all the options in respect of the group’s Scottish development sites and encourage any party with an interest to get in touch.”
Stewart Milne last year fell 40 places in Building’s Top 150 Contractors & Housebuilders list, which ranks firms by turnover. Its annual turnover reduced by 40% from £305.5m to £183.5m.
However, the firm said the drop was largely due to the sale of its timber business in addition to reduced spend on land during the covid-19 pandemic. As recently as five weeks ago a Stewart Milne spokesperson told Building the firm was “highly confident of delivering future growth”.
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