Rok pays £19m for Sol Construction

Rok has boosted its presence in the Midlands with the acquisition of Sol Construction.

The agreed price is £19m but the figure could climb to £21m depending on how Sol performs during the year to the end of March 2008.

The housebuilding operation within the Sol group remains outside the deal and will continue to trade separately as Sol Homes.

Founded in 1967, Sol Construction’s operations include construction, building and maintenance (both planned and response). With offices in Nottingham and Warwick, it has 410 employees. Of these, 250 are tradesmen operating in the maintenance division.

Rok is funding the £19m deal by way of £15m in cash and £4m-worth of Rok shares which can’t be put back on the market for two years. If the extra £2m needed to be paid later, this will come from bank debt.

The Sol operations that are coming on board as part of the deal made a pre-tax profit of £2.8m in the 12 months to 31 March 2006 and a figure of £2.7m is expected for the latest period (to 31 March 2007).

Sol has anticipated its construction-related turnover breaking the £100m barrier in 2008. Most construction projects are in the £3m-£5m band, with the policy being to bid on anything with a contract value of up to £20m.

Garvis Snook, Rok chief executive, said: “The Midlands has been a key target area for some time. Sol is a highly regarded business. Importantly, it further expands our own labour force where our preference for direct delivery of services is key to customer satisfaction and margin growth.”

Adrian Whiteside, managing director of Sol, said that his group has “an enviable client base”.