British property developer Henry Boot has entered into agreement to divest its construction division, Henry Boot Construction (HBC), to PWS Construction.
The buyer is a newly established entity formed by HBC's management team.
The transaction involves the entire issued share capital of HBC for an initial consideration of £4m ($5.4m), financed through a vendor loan note issued by Henry Boot.
After considering alternative exits and retaining HBC within the group, Henry Boot’s board concluded that a sale to PWS best serves shareholders’ interests.
The divestiture aligns with Henry Boot's strategy to concentrate on sectors it deems more key to its growth.
HBC’s contribution towards the wider group's profit is reportedly "small" and is not part of its medium-term growth strategy.
Specifically, of Henry Boot’s £10.2m operating profit in the first half (H1) of 2025, its construction segment, which also includes Banner Plant and Road Link alongside HBC, contributed £1.9m.
The sale of HBC is expected to streamline Henry Boot’s operations and enhance long-term growth prospects by focusing on projects with greater synergies.
Henry Boot CEO Tim Roberts said: “The sale of HBC which we are announcing today allows Henry Boot to further its strategic focus on high-quality land, prime property development and premium homes.
“It also enhances prospects for long-term growth with a more focused portfolio of activities with greater synergies. While HBC’s contribution to the group is relatively small, it is a well-established business with a strong track record of delivery and an excellent management team and we wish them well for the future.”
The sale price exceeds HBC's net assets, reducing the group's risk profile and decreasing headcount by approximately 21%.
HBC had reported revenues of £49.7m for full year 2024, but incurred an operating loss of £2.7m.
The transaction is anticipated to conclude by the end of this year.
For H1 2025, Henry Boot reported a revenue increase of 19% to £126.4m, driven by land and property disposals, with a profit before tax of £7.8m.
Last month, Henry Boot’s land promotion and planning segment, Hallam Land, secured outline planning permission for 2,470 homes in England.
