黑洞社区

Morgan Sindall was the frontrunner to purchase the businesses. It is set to buy 150 of Amec鈥檚 1,000 contracts and 拢800m of orders, stripping out the loss-making design and project services division. The deal catapults Morgan Sindall into the top five UK contractors with a turnover of 拢2.5bn.

The driver for the deal was Amec鈥檚 mixed-use regeneration business, Amec Developments, which has net assets of 拢60m. This acquisition puts Morgan Sindall into contention with clients such as BAA and the Ministry of Defence, and helps Amec, which would have struggled to offload the loss-making construction business separately.

A lot of Amec鈥檚 civil engineering business will be integrated into Morgan Est, the company鈥檚 infrastructure arm. Amec鈥檚 construction business will combine with Bluestone to create a new firm, Morgan Ashurst.

It is unclear if there will be job losses, although John Morgan, Morgan Sindall鈥檚 chairman, said the deal was 鈥渘ot about cost cutting鈥�. Management from both Amec businesses will remain.

Morgan Sindall was able to agree a deal quickly, ahead of the best offer deadline of 25 June, because it did not need to raise extra funds from the City.

Morgan Sindall has taken a lot of risk out of the deal

Mark Howson, Abn Amro

Morgan said: 鈥淭he development business is the interesting one but a lot has happened in construction. We鈥檙e buying the present and future, not the past.鈥�

Morgan Sindall will pay 拢55m for goodwill. Amec will pay Morgan Sindall 拢29m for liabilities and will retain contracts accounting for 拢24m of the 拢27m loss the construction business made last year.

Mark Howson, an analyst at ABN Amro, said he expects the deal to enhance Morgan Sindall鈥檚 earnings by about 17-20% in 2008. He said: 鈥淢organ Sindall is buying a clean business. It has taken a lot of risk out of the deal.鈥�

Morgan Sindall鈥檚 shares rose 13% to 1500p on Monday and continued to rise as 黑洞社区 went to press.