Property developer Henry Boot has sold its construction business to PWS Construction in a deal worth £4m.

An additional consideration on top of the initial £4m is potentially payable to the group if PWS sells all or a material part of HBC within eight years of completion.

The transaction for Henry Boot Construction (HBC) is being funded by PWS via a vendor loan note issued by Henry Boot, with terms of five years that will carry interest at 2.1% over the Bank of England’s base rate.

During 2024, HBC generated £49.7m of revenue with an operating loss of £2.7m in the consolidated financial statements of the group.

Henry Boot suggested the move to offload the division would allow it to focus on its strategic priority areas of “high-quality land, prime property development and premium homes”. It added that HBC was not part of the group's medium-term growth strategy and had made only a small contribution to group profits.

The Sheffield-based company said it had considered a “variety of options” for HBC, including both alternative exit routes and retaining the division within the group.

However, its board concluded that the interests of its shareholders would be best served by disposing of HBC to PWS at a price in excess of its net assets. It revealed that the disposal would reduce the risk profile of the group and reduce group headcount by around 21%.

Henry Boot CEO, Tim Roberts, commented: “The sale of HBC which we are announcing today allows Henry Boot to further its strategic focus on high-quality land, prime property development and premium homes. It also enhances prospects for long-term growth with a more focused portfolio of activities with greater synergies.

“While HBC’s contribution to the group is relatively small, it is a well-established business with a strong track record of delivery and an excellent management team and we wish them well for the future.”

Under PWS ownership, the business will be known as HBC Construction Group.

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