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Firms jostle for Amey's roads sector

THE SCRAMBLE to snap up the highways arm of cashstrapped Amey hotted up this week with some of Britain's biggest contractors all throwing their hats into the ring for the prized division.

The jostling comes just days before Amey is due to publish its annual results next Tuesday.

These will include details of a £115 million exceptional charge for 2002 and the scale of its debts.

Amey has been forced into a fire-sale to bring down its massive debts and more departures are expected.

Its highways arm is highly regarded and after weeks of speculation rivals are admitting they would like to buy it.

Alfred McAlpine, which has nearly £100 million in net cash earmarked for acquisitions, is an early front-runner and Ian Grice, who becomes chief executive in August, admitted: 'We are not interested in Amey as a whole but we would like to have a look at its highways arm.

'It has got a very good reputation. If there was a highways maintenance business available for around £50 million to £100 million we would be interested.'

McAlpine's road maintenance business turns over £60 million a year and has margins of just 2 per cent. Mr Grice said: 'We want to grow it to £100 million per annum and make it more efficient.'

Carillion is also expected to make a raid but chief executive John McDonough said it was more interested in picking up individual contracts rather than the whole of Amey's highways division.

He said: 'We couldn't pick up all of Amey's roads business because I think there could be a market share issue.

We're interested in bits that will give us synergy with our existing contracts. But the contracts are not in the gift of Amey, they're in the gift of the customer.'

Mowlem chief executive John Gains said: 'There are some good businesses inside Amey. We will keep a watchful eye on these and we have the capacity to add to our portfolio.'

But Amec chief executive Sir Peter Mason admitted:

'Maybe we would look at Amey's highways arm but we would have to do a pile of due diligence.'