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Company Spotlight: McInerney

FINANCE

WHEN a firm is dominant at home, a foreign venture is often the only solution to excite the market.

Dublin-based McInerney, Ireland's biggest house builder, has been going for a century and had operations in Spain plus a small presence in the UK with its Hargreaves Homes subsidiary.

The acquisition last January of Lancashire house builder Charlton for £8 million took the firm's UK completions up from just nine in 2001 to 310 last year.

The move was a brave attempt to get into the rapidly consolidating UK market and was timely, given that the Irish housing market is waning.

Profits from Irish land sales fell last year and the group only managed to maintain its margins there through an increase in completions as sales prices dropped.

Charlton provided the bulk of its UK sales with 192 completions, compared with 65 from Hargreaves Homes.

Managing director Barry O'Connor remains optimistic about housing in the UK and Ireland despite growing pressures on the smaller players.

Analysts suggest that the dwindling band of house builders with sales of less than 1,000 face being bought out and McInerney's market capitalisation of £50 million certainly makes the firm a viable target.

But UK house builders are unlikely to want to move into a waning Irish market even if McInerney, which has a dual listing in London and Dublin, was a willing seller and there is nothing to indicate that.