Silverdell held back by restrictive market

DEMOLITION and asbestos removal contractor and consultant Silverdell said tight funding continues to hold back further consolidation in the sector as it reported growing revenues and a strong order book.

The group last month announced the £18.6m purchase of Sheffield demolition firm EDS, which will double its size.

“(The market) is ripe for consolidation but the difficulty is access to funding,” said Silverdell chief executive Sean Nutley. “We got EDS for quite a decent price because there were no other buyers in the market at that level.

“We’ve got access to funding and can use paper.”

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He added while there “may be some private equity appetite”, trade buyers look unlikely at the moment.

Silverdell yesterday said adjusted pre-tax profits dipped to £1.1m in the six months to the end of March from £1.2m a year earlier. Revenues were up 12 per cent to £31.4m.

The group, which competes with firm’s including Wakefield’s Redhall and Leeds-based Renew Holdings, ended the period with a record order book of £133m. It has since secured revenues of £33m and announced the EDS deal. EDS employs about 200 staff, with 130 of these based in Sheffield. The combined group will have over 1,000 staff when the deal completes this month.

EDS specialises in demolition and decommissioning, and worked on the former Chapelcross nuclear plant in Scotland. It also has sites in Australia and Canada. Silverdell plans to merge the firms’ back office functions, but said there will be “no headcount reduction”.

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During the period it merged its UK remediation business, combining its regional Kitsons and Silverdell UK networks into a single business. This led to office closures in Scotland, Manchester, Birmingham and London, plus 22 job losses.

The group said it is on course to meet expectations for the full year.