Elm Tree steps in for Stodgell

by John Leitch



NG Stodgell, the £20m-a-year building contractor based in Taunton, has been bought by a holding company called Elm Tree Estates. Gordon Stead, who led Stodgell's management buy-out from the Haywards Group in January 1999, has been replaced as MD by Barry McKay.

Pete Masters, the major shareholder in Elm Tree Estates, said this week: "There will be no redundancies. The business plan is to lift turnover to £30m in the next 18 months. Stodgell has a good reputation for quality build. It has an excellent workforce and the move fits in with our plans to expand our construction workload in the south west."

Stead headed last year's mbo together with Stodgell's surveying director Peter Kirk and Trevor Chapman, estimating director. Kirk and Chapman are staying with Stodgell.

Masters has retained Stodgell's board with the exception of former chairman Colin Wilkins and ex-MD Stead. The two new appointments are Barry McKay, MD, and Alan Bacon, finance director. Bacon has replaced the former finance director Mike Shaw.

McKay declined to reveal his former employment. Masters said "he comes from a construction company linked to Elm Tree Estates" but would not elaborate further.

Stodgell undertakes both civils and building projects in the south west region, mostly within the price range £500,000-£2m. The group has 180 employees, both staff and workforce. McKay said the group has been trading profitably.

He added: "Since the mbo they have done well in getting orders. They needed a good organisation put in place and would have done it in time. It was still being changed."

A source told Contract Journal that the latest changes at Stodgell are the result of the mbo's funding company from Bridgwater wanting to pull out. "They couldn't secure bonds in the market and that restricted their client list," the source said.

Masters denied any problem with bonds. "The bonds are still ongoing," he said. "There is no problem." He said he had paid over £1m for a 100% shareholding in Stodgell and its subsidiary Somerset Finishes, a painting contractor. Stodgell's assets include a landbank.

Elm Tree Estates holds four other trading groups, all of them being property linked. "Stodgell wasn't on the market," Masters said. "It was me who made the approach."

Talks are thought to have started in November last year.