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Bankers prepare for fresh float fever with deals aplenty


The UK's largest privately owned housebuilding and construction firm is poised to join the raft of companies rushing to float this year after appointing advisers to consider “strategic options”.

Keith Miller, the chief executive of the Edinburgh-based Miller Group, told The Independent that he has appointed investment bank Moelis to look at a range of alternatives, including a flotation which analysts suggest could value the business at around £300m.

Mr Miller said the company, which reported a 58 per cent rise in pre-tax profits to £10.4m last year, was “well positioned to take full advantage of improving market conditions”.

He added: “We are looking at all the options and appointed Moelis a couple of weeks ago. We will consider the outcome of the review carefully and we are not rushing.”

Mr Miller, who joined the group in 1975 and has led the 80-year-old business since 1994, is the nephew of founder Sir James Miller, later the Lord Provost of Edinburgh and Lord Mayor of London.

The business was family controlled until a refinancing in 2011, which left US private equity group Blackstone with 54 per cent of the company's shares. Royal Bank of Scotland and Lloyds Banking Group own 32 per cent, with the family and management holding a stake of just 8 per cent.

Analysts said most of the group's value would be in the housebuilding business, which accounted for 40 per cent of its £817m turnover last year, but delivered the lion's share of operating profits at £22.8m.

Miller also includes a mining, development and construction arm, although the £400m construction business lost £4.6m in 2013 after write-offs on certain contracts.

If Miller does opt to float, it will join a long list of companies - most recently Poundland and Pets at Home  - competing for cash in public markets, as rising recovery hopes boost sentiment and private equity owners seek an exit. 

The owners of Saga, the over-fifties group, have also stepped up their efforts to float the business on the London Stock Exchange for £3bn.

The parent company Acromas Holdings, which is owned by Charterhouse, CVC Capital Partners and Permira, is close to appointing Goldman Sachs to lead a flotation that could propel the group into the FTSE 100.

Bank of America Merrill Lynch has also been touted as another investment bank likely to be on the ticket. It is already working with Saga to gauge the reaction of the financial services group's customers - who could be handed free shares.

The former boss of Domino's Pizza, Lance Batchelor, is set to take the helm at Saga in May.

Saga was merged with the roadside assistance firm AA in a 2007 deal valuing the group at £6.2bn. That was funded by cheap credit and lumbered the company with debts of £4.1bn.

The AA is now expected to be sold, or even listed, separately.