Firm first made approach for concrete frame contractor at start of the year
South African builder Wilson Bayly Holmes-Ovcon (WBHO) is believed to have shelled out north of £10m for a stake in Byrne Group after first approaching the concrete frame and building contractor about a deal at the start of this year.
Listed on the Johannesburg Stock Exchange, the firm, which was founded back in 1970, has taken a “significant minority” stake in the business which was set up by brothers Patsy and Johnny Byrne in 1969.
The ZAR 29.5bn (£1.8bn) turnover firm has a number of offices in South Africa, including Durban and Cape Town, and carries out both building and civils work.
Among the schemes it has worked are roads, power stations, apartments and stadia.
Building understands the firm made an approach to Byrne Group, which is working on the Chelsea Barracks apartments scheme as well as the Westfield shopping centre extension in west London and Bloomberg’s new UK headquarters in the City, at the turn of the year after the South African firm decided the time was right to follow a number of its clients and break out of its domestic market and into Europe and the UK.
No figure has been given for the size of WBHO’s stake but it is believed to be between 20% and 49%.
A Byrne Group spokesperson said: “The family will be retaining control. The [WBHO] investment will remain in the business to help it grow.”
In its last set of accounts for the year to May 2016, Byrne Group, which also includes the Ellmer building business along with its loss-making Chorus fit-out arm, posted revenues of £329m.
But the firm racked up a £12m pre-tax loss which it blamed on sorting out Chorus’s legacy contracts.
Concrete frame business Byrne Bros trebled its profit to £6m but Chorus slumped to a £13.9m loss. The firm said the remainder of Chorus’ contracts are profitable and will complete in the 2017 financial year which completed at the end of last month.
It is understood that Byrne Group will in the future just be concentrating on its concrete frame and Ellmer arms.
Byrne, whose previous projects include the Shard and the 2012 Olympic stadium, currently works within the M25 but the investment has prompted speculation it could now target UK work outside its traditional London and South-east heartland.
Under the deal, Paul Foley, WBHO’s group building managing director, will join the Byrne Group board.
Byrne Group’s chief executive Michael Byrne (pictured) said: “I am delighted to welcome Paul Foley to our board. This strategic investment with WBHO is a very exciting strategic move which will broaden and strengthen our capacity to target opportunities that are evolving in the post-Brexit world of construction.”