The City reacted kindly to Tuesday’s news that John Mowlem has sold its remaining 51% stake in scaffolding business SGB for £95.6m.

The buyer is US firm Harsco, which valued SGB at about £188m. The bid, at 250p a share, is a 57% premium on SGB’s closing price of 159.5p on Monday.

SGB issued a statement saying the bid was “inadequate”. It is now keen to stop Harsco buying the remaining 49% of is shares.

However, analysts who follow Mowlem welcomed the deal and the contractor’s shares rose 27p to 117.5p on Tuesday. One analyst calculated that the sale would leave Mowlem with £75m cash on its balance sheet after it gave shareholders the £50m that it promised as a result of the sale.

He said: “With some borrowing, it could spend £90m on an acquisition. The question is whether it uses it wisely or aims it at the wall.”