Mowlem float to value SGB at pounds 100m

John Mowlem is to float off SGB, its scaffolding subsidiary, in a share placing that will value the company at about pounds 100m this summer. The return of SGB to the stock market comes 11 years after Mowlem bought the business for pounds 160m, although the company said disposals since meant the two figures were not comparable.

Bob Stokell, chief executive, said: "SGB is recognised as a leader in access products, and serves a world-wide market. It has an ability to provide innovative solutions to the most complex of client demands. As an independent company, SGB will be able to develop further an already strong brand name."

SGB, founded in 1903 and floated on the stock market in 1922, is one of the world's largest companies involved in the manufacture, sale and hire of access equipment for the construction industry. As well as access products for the new build construction market, it provides scaffolding equipment for buildings and pipeline structures in the oil, chemical and steel industries.

Mowlem will keep 51 per cent of SGB's shares after the flotation and directors will be given so far unspecified stakes in the business, which currently employs around 4,000 in 125 locations in 20 countries.

For the financial year to December, SGB recorded pre-tax profits of pounds 16m (pounds 11.7m) on turnover of pounds 263.2m. Mr Stokell, who joined last year when Mowlem's chairman, Ken Minton, poached him from his own former company, Laporte, said he had targeted an increase in SGB's return on sales from about 6 to 10 per cent and a rise in return on assets from 10 to 18 per cent. Brokers have forecast operating profits of pounds 18m for SGB this year.

As well as Mr Stokell, Mowlem has also appointed Stephen Yapp, former finance director of Hadleigh, the storage tank company.

The two plan further rationalisation of SGB's UK business, reducing its manufacturing outlets from seven to two.