Property firm GVA weighs up options for flotation

The company, which was founded nearly 200 years ago, has appointed Canaccord Genuity to review strategic options.

It is understood the investment bank is looking at whether to float, sell, or refinance the company, which would help it pay back its minority private equity owner LDC and compete with its peers on the international stage.

LDC took a share in the company, which employs over 65 people in Leeds, following a debt-for-equity swap last year, when it exchanged £60m of loan notes for a 22 per cent stake, which will eventually rise to 30 per cent..

A refinancing could come in the form of a normal bank loan or an attempt to tap the bond market.

If an initial public offering were made, the company could be worth around £120m.

GVA is embarking on an aggressive growth plan to boost profits to £20m by 2016.

In the year to April 2013, it made a pre-tax profit of £7.8m, £7.7m up on the previous year following a boost by the previous year’s debt for equity swap.

Turnover was £147.3m, up from £140.4m the previous year

GVA reduced its bank debt by £9.4m during the year to £7m. The company is on course to become debt-free within a year.

The company said it brought forward its attempt to bring new capital into the company following an upturn in the global financial markets and property sector.

The board had been expecting to start the process in autumn 2014.

Chief executive Rob Bould said: “The success of our company restructure 18 months ago, coupled with our ability to build on that platform throughout last year with an outstanding end of year, has turned GVA into a much stronger proposition that is now primed for further growth.”

He added: “Positive market sentiment built on hard evidence that better times lay ahead here in the UK and globally, means now is an important period in which to invest in our future and gain further momentum. With this in mind, this latest move marks our next logical step for further growth.”

Paul Manning, senior director and head of office at GVA in Leeds, added: “GVA has a strong network of regional offices, and in recent years here in Leeds, we have consistently added to both our fee income and our staff numbers, such as in our building, planning and valuation teams.”

He added: “Our business here in Leeds continues as usual.”

Meanwhile, Bruntwood, the Manchester-based commercial property agent, which has an office in Leeds, has today announced a £221m, five-year financing facility with a syndicate of four banks.

In the last 12 months, the company has refinanced its entire £600m of debt.

In the final part of its refinance, Barclays, HSBC, The Royal Bank of Scotland and Santander UK have each provided £55.25m to refinance existing debt and to support Bruntwood’s future growth plans.

Chris Oglesby, Bruntwood’s chief executive, said: “Bruntwood has always made long term sustainable growth its priority, rather than short-term commercial gain.”

Kevin Crotty, chief financial officer, added: “Bruntwood has demonstrated its financial standing and its ability to innovate in raising capital.”