Balfour Beatty buys parts of failed Rok for £7m

Balfour, Britain's market leader in big-ticket construction projects, said the newly acquired businesses and their 381 employees would be folded into Mansell, its regional construction business, and would add around 100m a year to group sales.

"Rok's operations in affordable housing, which are principally in the South West and North West of the UK, will support Mansell's strategy of being a leading provider in affordable housing where long-term demographics are favourable," said Balfour in a statement.

"Rok's general construction activities will enhance Mansell's existing capabilities at Heathrow and Gatwick airports as well as expanding its geographical presence into the South Midlands."

Rok went into administration earlier this month after difficulties meeting financial obligations, two months after bigger rival Connaught collapsed.

Balfour, which helped build the world's biggest shopping centre, the Burj Mall in Dubai, said it had paid an initial 4m and would settle the remaining balance once contracts were exchanged.

"We are working with Rok's administrator towards an efficient transition of these operations to minimise disruption to clients and to protect jobs in the operations we are acquiring," it added.

The deal saves some jobs in Wakefield, Rochdale, Milton Keynes, Gatwick and Heathrow. However, sites in Reading, Crawley, Bristol and Exeter as well as the social house building activities in Leeds are being closed down with 235 redundancies.

Toby Underwood, business recovery services partner at administrators PricewaterhouseCoopers in the North, said: "The agreement in principle announced today to sell parts of the construction and social house building division of Rok to Mansell Construction Services, a subsidiary of Balfour Beatty has saved 202 jobs in Rochdale and 11 jobs in Wakefield.

"In addition we have retained a small number of employees across the North to help with the orderly closure of various locations. As we have already committed, those employees who continue to be employed by the company and attend work will continue to be paid."

Jeremy Webb, director and joint administrator at PwC said: "We are delighted that we have been able to secure a sale of part of the business hence preserving employment for 381 people.

"This is tinged with disappointment that there was not sufficient interest in the other parts and hence the redundancies that have been made today."