While many big building contractors, notably Sir Robert McAlpine and Mace, are building up their civil engineering capabilities to benefit from big public works in the pipeline, Osborne is going in the opposite direction.
Osborne's infrastructure business works across rail and highways and has longstanding relationships with Network Rail, Highways England and Transport for London.
Osborne Infrastructure Ltd began trading in 2017 following what the company described as 鈥榓 hive down鈥� of the infrastructure division from the Geoffrey Osborne Limited group. It undertook work on the existing contracts under a subcontractor agreement with Geoffrey Osborne Limited. This was the first step towards a long-planned disposal, to transform the core business from a generalist contractor to being a development-led business.
The sale will complete on 10th of September 2021.
Osborne Infrastructure Ltd (or OIL) accounts for roughly a third of group revenue. In the year to 31st March 2020, it turned over 拢131m and made a pre-tax profit of 拢3.9m. Latest accounts for parent company Geoffrey Osborne Limited, for the year to 31st March 2019, show turnover of 拢381m and pre-tax profit of 拢4.5m.
"Whilst we have been focussing on the growth of our Developments and Innovar茅 businesses, this has been at times at the expense of Infrastructure," a spokesman said. "We have not been able to provide the investment that they really needed to grow and prosper with their customers." Innovar茅 is Osborne's modular construction business, building with structural insulated panels.
He added: "Historically we have operated across a very broad range of markets in property, rail and highways and with this brings conflicting customer needs. With our businesses having very different priorities and targets, it has been challenging to align our activities under a single defined purpose and this made it increasingly difficult to balance and prioritise our business investments."
Under new owner Sullivan Street, Osborne Infrastructure will continue to operate under the leadership of managing director John Dowsett, who now becomes CEO. David Fison, former CEO of Skanska UK and the Osborne Group, is joining the business as chairman.
Richard Sanders, founding partner of Sullivan Street, said, 鈥淲e are excited to be acquiring a business with a fantastic reputation and which provides essential infrastructure to the nation鈥檚 transport networks. We look forward to supporting the management team as OIL enters its next chapter as a focused independent business.鈥�
Osborne Infrastructure chief executive John Dowsett said that Sullivan Street鈥檚 investment would help the business achieve the growth ambitions set out in its business plan.
Geoffrey Osborne chief executive Andy Steele said getting out of infrastructure would allow the remaining business to focus specifically on the residential and education sectors. Building and maintaining affordable housing generated 拢98m of the group鈥檚 拢381m revenues in 2019 and education building projects brought in 拢83m.
鈥淚 am delighted to have reached this exciting milestone in the history of Osborne,鈥� he said. 鈥淗aving secured the very best sponsor for Osborne Infrastructure Ltd, we now have an amazing opportunity to prioritise our investments and focus our energy and resources into becoming market leaders in the residential and education sectors. This move provides us greater clarity of purpose and with our in-house expertise we can add value into every stage of the property lifecycle. Through offering end-to-end land acquisition through operation and property maintenance, we will provide sustainable, intelligently designed spaces that improve people鈥檚 lives.鈥�
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