Pearce bosses in cut-price buyout

CONSTRUCTION company Crest Nicholson has sold its multi-million pound shopfitting subsidiary, Pearce Group, to a management buyout team for just three times its forecast profits.

Pearce, a construction services firm based in Bristol, specialises in refitting and extending stores without closing them down.

The firm, which also supplies services to the health, leisure, education and defence sectors, suffered a £3m loss last year on turnover of £184m, following the closure of a joint venture making semiconductors with German firm M&W Zander.

But with revenue from the retail sector growing by nearly 30% in the past five years, the group expects profits to jump to £3m on sales of £200m next year.

Chief executive John Rackstraw and finance director Tim Leigh led the £9.2m buyout, which was backed by Lloyds TSB. Pearce's 626 staff will also benefit from 49% of the firm's shares set aside for them in a trust fund.

Pearce's regular clients include Asda, Sainsbury, Fitness First and Whitbread. Crest Nicholson will remain a key customer and the firm aims to expand its business in the public sector.

Crest Nicholson, headed by chief executive John Callcutt, said on Friday its profit in 2002 would hit record levels. The announcement helped the shares leap 7% on the day. But over the week they were still down 7p at 189p.