Open to offers
Stewart Milne Group up for sale as founder retires
Stewart Milne Group is seeking offers for the housebuilding business following the decision of its founder and principal shareholder to retire.
Nearly 50 years after setting up the company, 71-year-old chairman Stewart Milne said he now wants to focus on other ventures.
The board was faced with significant investment to create high margin development opportunities but has decided to capitalise on the current strength of the market by inviting offers.
It has appointed EY to act as advisers in the sale process and the Aberdeen-based business is expected to attract keen interest, with Barratt, Cala, Springfield Properties and Taylor Wimpey likely to be in the frame.
The company’s last financial year to the end of October was one of its best ever, with a sharp increase in turnover and profits driven by high demand for its family homes. It put the timber frame business up sale in October and in December it was sold to Donaldson Group.
Mr Milne said: “The unprecedented events of the last two years have forced many to re-evaluate and, after considerable soul-searching, I have decided that the time is right to step back from the business I founded to prioritise my time for family, friends and other ventures I want to pursue.
“In the last 18 months, we’ve significantly strengthened the business with major efficiencies and our new homes range.
“We are superbly placed to capitalise on the favourable market conditions and demand which are set to continue in the near-term.”
Chief executive Stuart MacGregor said: “We anticipate attracting a high level of interest from potential buyers who will invest in order to capitalise on the strength of our business and the buoyancy of the current homes market.
“We have one of the strongest sales pipelines in our history and anticipate generating significant sales over the next two years. With a strategic bank of land, award-winning developments, our new homes range and recently completed investments in new IT systems and in digital transformation, Stewart Milne Group presents a compelling proposition.”
However, he said that with land prices rising, more investment is needed to take advantage of the group’s land-buying experience and the development opportunities available.
Stewart Milne Group has offices in Aberdeen, Edinburgh, Glasgow and Manchester with a workforce of 1,000, including sub-contractors. Around 20 developments are currently at various stages across Scotland and North-West England including Dargavel Village, Shawfair, Haddington, East Linton, Hooton and Congleton.
The firm posted a pre-tax loss of £71.5m on a turnover of nearly £269.7m in the pandemic year to 31 October 2020. That followed a £59.2m write-down to account for land value falls and restructuring costs.
The loss follows a £48.5m loss in the previous accounting period, which covered 16 months from July 2018 to October 2019, after the business embarked upon a major restructuring programme.