Merseyside firm clinches £11m deal

May 29 2008 by Alex Turner, Liverpool Daily Post

NEWTON-LE-WILLOWS-BASED Speedy Hire has acquired construction firm Carillion’s accommodation business for £11m.

The FTSE-250 tool hire company already has its own accommodation division, Speedy Space, which will gain Carillion’s three UK depots and 23 employees.

The deal formed part of a five-year strategic partnering agreement between the two companies. It reinforces Speedy's position as Carillion's preferred supplier of its full range of products and services, and extends across all Carillion group companies, including the recently acquired Alfred McAlpine business.

The accommodation business services both the Carillion group's internal accommodation requirements as well as external customers.

In March, Speedy, which employs more than 5,000 staff, was forced to deny reports that it was considering selling off its Speedy Space subsidiary in a bid to cut its debts.

Yesterday’s agreement was announced alongside Speedy’s preliminary annual results for the year to March 31, which showed a 19% rise in pre-tax profits to £48.1m. Turnover also rose 39% to £465.5m.

Chief executive Steve Corcoran said the company's exposure to the public sector would outweigh a fall in house building in the private sector, which accounts for less than 5% of its revenues.

He said: “We are mindful of the current uncertainties sur-rounding UK economic growth, although in our own markets we are not currently experienc-ing any overall downturn.

“While housing and commercial office building has contracted significantly, the impact of a reduction in these areas has been offset through the continued investment in improving UK infrastructure and those areas covered by regulatory spend, such as electricity, gas and water.

“It is increased activity in these areas that has led the majority of our customers to report positive market conditions and prospects.”

Speedy’s tool hire division, which has 357 outlets, increased revenues by 47%. This was mostly because of its acquisition of 188 depots from Hewden Tools, which it bought for £115m in August, 2007. Its 131-outlet equipment hire division also saw strong revenue growth, of 30%.

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