Mears Share Discussion Threads

[yoyoy] 14/9/2010 16:59

Rivaldo,

I'm glad someone else has the take on the RNS,

[rivaldo] 14/9/2010 13:10

A very promising RNS - and thx to copyright for the Telegraph heads up, which confirms MER are in talks to buy around £100m of contracts for a nominal sum.

It seems to me that Morgan Sindall may regret rushing in to be first to pick up contracts without doing enough due diligence, whereas MER are taking their time to unravel CNT's mess and are being careful to only take on suitably profitable deals.

[yoyoy] 14/9/2010 11:58

"14 September 2010
Mears Group PLC
("Mears" or "the Company" or "the Group")

Update Re: KPMG/Connaught

The Board of Mears notes the recent press coverage of the Connaught situation
and the KPMG administration and confirms that the Company has acquired contracts
for a nominal sum that provides an opportunity to deliver services to a small
number of customers. Discussions with these customers are still ongoing so the
Mears Board is not yet in a position to provide clarity on the future revenues
which may arise as a result.

A further announcement will be made as and when it is appropriate to do so.

Commenting, Bob Holt, chairman of Mears Group, said:

"This is a sad situation not only for employees but also for subcontractors and
the communities that depend on these services. We are pleased to be able to
offer our services to those local authorities who found themselves at risk of
not providing their tenants with a repairs service."

ends.

"

[copyright] 14/9/2010 09:46

According to today's Telegraph...the 8 contracts which Mears has agreed to take on are the BIGGEST of Connaught's customers (with the exception of Norwich Council) with annual revenue of £100 million.

All acquired for a nominal sum, sounds like an exceptionally good deal by Bob Holt for Mears.

[tom.b] 14/9/2010 07:57

Nothing will happen to share price until an RNS gives more detail on just what is being taken over from CNT ... but anything they get is a windfall to an aleady succesful company - they won't take on loss making liabilities... and the cuts will have little effect - except to widen the profit margin...no harm to add a few at this level..IMO

[rivaldo] 14/9/2010 07:25

MER to take Yorkshire off of CNT's hands:



"THE number of Yorkshire redundancies at collapsed social housing group Connaught rose to 300 yesterday, but there are hopes some will keep their jobs after Mears Group said it will take over eight housing contracts.

Mears, a social housing repairs provider, will take over a contract with Yorkshire Metropolitan Housing Association as well as seven other contracts around the country.

The total number of redundancies at Connaught rose to 1,100 yesterday after administrator KPMG announced a further 400 job losses on top of last week's 700 redundancies.

But Mears said it hopes to re-employ some 600 of the 1,100 staff who have been made redundant. It is not yet clear how many of the 300 Yorkshire job losses will be saved."

[rivaldo] 13/9/2010 21:42

More tonight:



"Connaught Collapse To Cost Another 400 Jobs Share Share Comments (1)
6:09pm UK, Monday September 13, 2010

Tim Hewage, Sky News Online

The collapsed social housing company Connaught will lose a further 400 jobs, administrator KPMG has announced.

1,100 of Connaught's 4,200 former staff have now been made redundant

This means a total of 1,100 will have lost their jobs since the West Country firm collapsed last week.

KPMG went on to say that up to 600 staff jobs could be saved, however, in a re-employment deal with rival company Mears.

Set up in 1988, Mears employs 8,000 people and provides maintenance and repairs services to some 500,000 homes in England.

The Mears group, based in Gloucester, also specialises in social housing and is understood to be taking on eight of Connaught's contracts."

[rivaldo] 13/9/2010 10:44

Excellent news whilst on my hols about CNT going into administration.

Today's FT notes that MER are taking great care about the proposed acquisition of contracts from CNT, which is good to see. MER are paying almost nothing for them, but in the usual cautious MER style are making sure that the contracts won't be albatrosses.

Exciting times - hopefully there's about to be a Morgan Sindall-style jump in the share price when the deal is formally announced:



"Connaught agreement with Mears unclear
By Alistair Gray

Published: September 13 2010 00:18 | Last updated: September 13 2010 00:18

Uncertainty has emerged over Mears' agreement to acquire contracts from Connaught, its collapsed rival, as the social housing maintenance group scrambles to finalise the details.

Investors in Mears had expected to be told on Monday morning that the company picked up about eight of the former FTSE 250 company's contracts after Bob Holt, executive chairman, said on Friday night he had sealed the deal.

Although the agreement still stands, it appeared on Sunday night that Mears was unlikely to make an announcement when the stock market reopened. It was not clear whether or not KPMG, which was appointed administrator of Connaught last week, intended to do so.

A person familiar with the matter said Mears was unlikely to update the market until it had "properly determined the various constituent parts of each contract" and had "a detailed understanding of the cost structure of each contract".

The agreement was complicated by the fact that Mears was expected to re-employ some of the 700 workers made redundant by KPMG, people familiar with the matter said.

Mears is expected to pay a nominal fee to take on the work, which involves about 1,000 workers, although it is not clear which contracts it has acquired.

Before its collapse, analysts had raised concerns about how Connaught accounted for its contracts. They were particularly concerned about "mobilisation costs", or expenses incurred at the start of a contract.

Connaught had drafted in Deloitte to review its accounting practices at the company, which was audited by PwC since 2006.

Mr Holt said on Friday that the contracts Mears was acquiring did not include work for Norwich City Council. Connaught had won a £125m five-year "integrated services" contract with the council but it became subject of a dispute."

[cambium] 12/9/2010 21:03

what a whole 7% upside?

[tom.b] 12/9/2010 13:08

All bodes well for Mears share price on monday... They're doing well anyway without anything of CNT.. £3 is my short term target

[yoyoy] 12/9/2010 06:59

This is well worth noting from the FT

"Connaught had blamed its difficulties on public spending cuts as councils deferred projects to improve their social housing stock and said that they had been exacerbated by pressure from suppliers.

Supplier concerns had risen after it emerged that Deloitte had been drafted in to review the company's accounting practices.

However, Mears was one of the most vocal companies in distancing itself from the woes of its rival. Little more than an hour after Connaught issued its first profit warning in June, Mears said it had not experienced similar difficulties.
"

here is the link to the full article

[yoyoy] 12/9/2010 06:53

Teelegraph

"Mears is paying a nominal fee to acquire the repair and maintenance contracts, it is understood, and is also in talks about snapping up a contract with Norwich City Council, one of Connaught's biggest clients.

Bob Holt, chairman of Mears, said his company was "delighted" with the progress of talks with KPMG, the administrator to Connaught's social housing division. In addition, a number of Connaughts's customers are believed to have independently approached Mears about taking on work.

"

[nfs] 11/9/2010 21:13

Today's FT has Mears buying some contracts from Connaught,and the Norwich contracts is not in the package

[mdrans1] 11/9/2010 20:03

If Morgan Sindal is a whale @ £305M market cap, Mears @ £237M is some sprat!!

[dnfa1975] 11/9/2010 12:07

problem is Morgan Sindal is a strong player, stronger and bigger than mears.
A sprat and a whale, prepare for battle

[copyright] 11/9/2010 11:08

From today's Daily Mail >>>>>>>>>>>>>>>>>

More than 2,500 jobs have been saved after building firm Morgan Sindall snapped up the majority of contracts from failed social housing maintenance group Connaught.

And a further 1,000 positions are likely to be secured this weekend as Mears ties up an agreement to take over eight maintenance deals.

Morgan Sindall is not taking on Connaught's 12 biggest contracts, including its largest deal to maintain housing stock for Norwich City Council, because the company considers them to be loss-making.

The business spent £28million to buy around 100 contracts from Connaught, which it hopes will generate £200million a year for the firm.

The contracts, which account for 80 per cent of Connaught's deals, will be transferred directly into Morgan Sindall's affordable housing division, Lovell.

John Morgan, executive chairman-of Morgan Sindall, said his firm only took on 80 per cent of Connaught's contracts because he felt the rest were badly priced.

Housing group Mears, which was also in the running for the contracts, said it is continuing to negotiate to take on some work.

Chairman Bob Holt said: 'We've already picked up a number of contracts with local authorities, who have approached us directly and we will be looking at picking up the remaining contracts next week.'

[turborock] 10/9/2010 22:29

they acquired "the majority". I guess we'll have to wait and see

[miss womble] 10/9/2010 12:27

Does anyone know if Morgan Sindall has left anything for Mears or have Mears already cherry picked up some contracts isolated by Connaight's downfall. Rgards MW

[dnfa1975] 09/9/2010 20:20

hopwe to get a slice at 250p

[tom.b] 08/9/2010 23:36

Mears are going to get a premium and uplift on these new contracts before they take them on... Bob Holt don't take wild chances...£3.00 sooner than we think or hoped!

[celeritas] 07/9/2010 22:58

Rivals circle as Connaught confirms administration
Tue 7th September | 21:54

Rival contractors are vying to take over Connaught jobs as the firm confirmed its fall into administration.

Councils and housing associations will mobilise plans to replace the ailing contractor as accountant KPMG steps in to run the company

Firms like Mears, Rok, Morgan Sindall and Willmott Dixon will be sounded out by housing bodies as the future of Connaught and its 10,000 workforce remains uncertain.

A Connaught Stock Exchange update said: "Following extensive discussions with the Group's secured lenders, it is now clear that sufficient support would not be extended to the Group as a whole to enable it to continue trading as a going concern.

"As a consequence, the Board is saddened to announce that it is in the process of appointing partners from KPMG as administrators of Connaught plc and its subsidiary, Connaught Partnerships Limited, which comprises its Social Housing Division."

The group's compliance and environmental divisions are not being placed into administration and will continue to trade normally.

Accountants at KPMG will now run Connaught while they seek to find a buyer for the business.

Contracts could be sold-off individually as rivals circle the remains of the firm.

John Morgan, chief executive of Morgan Sindall: "Clients have been approaching us over the last few weeks, but there has been a sharp increase in the number of approaches today."

Bob Holt, chairman of Mears Group, said: "We are watching the situation carefully and we are ready and willing to pick up work if it becomes available, we have been approached."

Another contractor told the Enquirer: "Now this has been confirmed it will be a case of talking with KPMG and seeing what contracts are up for grabs."

[celeritas] 07/9/2010 19:52

Contracts will have to be renegotiated but I also expect someone wil have to step into the void left by cnt pretty quick.
MER and ROK are the two who stand to gain the most from Connaughts demise.