Tilbury finance director Stuart Lee said the sell-off, predicted by Building last June, meant that 80% of the firm’s business was now in support services-related activities.
This move follows the example of former contractor Amey, which reinvented itself as a support services company from a construction and building materials firm last year.
Support services companies, with their steady, long-term income streams, are generally regarded by the City as more attractive investments than cyclical construction stocks.
Lee said a final decision on the sector switch was “out of Tilbury’s hands” because of stock market requirements, but added that it was now “an obvious objective”.
Last year, Tilbury bought facilities management firm Bandt for £75.3m, which took it a step away from contracting. Tilbury now focuses on long-term maintenance work for industrial and property clients as well as negotiated new-build work for large, repeat clients.
It has already stopped building houses in England, and Tilbury chairman Mike Bottjer said the Scottish business, Tilbury Douglas Homes, no longer fitted in with his long-term strategy. He added that the disposal would provide funds for “the further development of support service operations”.
Lee said the company was considering “a whole range of acquisition opportunities”.
The homes business, which operates from Edinburgh to Glasgow and as far north as Stirling, made a pre-tax profit of £4m in the year to 31 December 1999. It built about 400 houses for an average selling price of £80 000.
Persimmon chief executive John White said the acquisition would mean Persimmon, which currently builds about 600 houses a year in Scotland, would build well over 1000 units in the country this year.
As part of the purchase, Persimmon gets 16 new sites plus further interests in partnership housing schemes. It also adds 1000 plots to Persimmon’s Scottish land bank. This now totals 3100 plots with planning permission.
