Alfred McAlpine

Alfred McAlpine was a British construction, civil engineering and infrastructure services company headquartered in Hooton, Cheshire. Its origins lay in the north-western English operations of Sir Robert McAlpine, the construction business associated with Alfred McAlpine’s father, Sir Robert “Concrete Bob” McAlpine. Alfred McAlpine took responsibility for those regional operations after the deaths of Sir Robert and his eldest son in 1935. Although the business operated independently from that point, its legal separation from Sir Robert McAlpine was completed in 1940, when Sir Alfred McAlpine & Son was formed. For much of its early existence, the company was constrained by a non-compete arrangement with Sir Robert McAlpine. The agreement limited Alfred McAlpine largely to civil engineering work in north-west England. Its position changed in the early 1980s, when the geographical restriction was removed, allowing the company to pursue wider national growth. Some contractual issues between the two businesses continued to generate legal disputes into the twenty-first century. The company became a public company in 1958, when it was floated on the London Stock Exchange under the name Marchwiel Holdings. It adopted the Alfred McAlpine public identity in 1985. Civil engineering, especially motorway construction, became one of its most important historical activities. During the post-war motorway-building programme, Alfred McAlpine became one of Britain’s leading road contractors and was credited with constructing more than 10 percent of the country’s motorways. Later road work included participation in the CAMBBA consortium for the M6 Toll. Alfred McAlpine diversified when the civil engineering market weakened during the 1970s. It entered private housebuilding through acquisitions including Price Brothers, Finlas and Canberra, and it made investments in the United States housing market. By the end of the 1980s and into the 1990s, housebuilding accounted for a substantial share of group profits. The company became one of the United Kingdom’s larger housebuilders, producing more than 4,000 homes annually by the late 1990s. It also owned Penrhyn Quarry in Wales, described as the country’s largest slate works and later operated through Alfred McAlpine Slate. The group subsequently shifted away from housebuilding and toward support services, facilities management and infrastructure maintenance. In August 2001 it sold its housebuilding operations to George Wimpey for £461 million and announced plans to return more than £100 million to shareholders. It acquired Kennedy Utility Management later in 2001 and purchased Stiell in 2002, expanding into facilities management and information-technology network systems. Its activities eventually included business services, project services and infrastructure services, with customers in both public and private sectors. By 2006, the company had begun a major facilities and building-management contract covering Mapeley’s United Kingdom property portfolio, and approximately 75 percent of its activities were in the private sector. The company’s final years were affected by accounting irregularities at its slate business. In 2007, Alfred McAlpine recorded a £13 million impact after an investigation found that several managers had deliberately colluded over multiple years. Former managers later admitted fraud-related charges. The incident raised questions about the future of the slate operation and contributed to uncertainty around the group. Carillion made takeover approaches in 2007, initially without success. In February 2008, Carillion acquired Alfred McAlpine for £572 million. The transaction removed Alfred McAlpine from independent stock-market ownership and made Carillion the largest support-services company in Britain at that time. Carillion began selling or reorganising parts of the former Alfred McAlpine business during the same year. Alfred McAlpine therefore ceased to operate as an indepen…

Alfred McAlpine developed from the north-western English operations of Sir Robert McAlpine. Alfred McAlpine, a son of Sir Robert “Concrete Bob” McAlpine, ran those operations after the death of Sir Robert and his eldest son in 1935. The regional business became legally distinct in 1940, when Sir Alfred McAlpine & Son was established. The early company operated under a non-compete arrangement with Sir Robert McAlpine. It was largely confined to civil engineering in north-west England, although the business retained a connection to the wider McAlpine construction tradition. In 1958, the company was floated on the London Stock Exchange under the name Marchwiel Holdings. The public name Alfred McAlpine PLC was adopted in 1985, two years after the geographical restriction in the non-compete agreement had been removed. Certain other terms of the historical arrangement remained contentious and contributed to legal action in later decades. Civil engineering and road construction became central to the company’s development. During the 1960s, Alfred McAlpine participated in Britain’s motorway-building programme and became one of the country’s leading civil-engineering contractors. It was eventually associated with construction of more than 10 percent of Britain’s motorways. Its later road portfolio included involvement in the M6 Toll through the CAMBBA consortium. The company diversified during the 1970s, when the civil-engineering market weakened. It moved into private housebuilding through acquisitions such as Price Brothers in 1978, Finlas in 1982 and Canberra in 1988, and also made investments in the United States housing market. It acquired Penrhyn Quarry, a major Welsh slate operation, and slate produced by the quarry could sometimes be used in the group’s construction activities. By the end of the 1980s, private housebuilding was generating the largest portion of group profits. Leadership changed within the McAlpine family in 1985, when Jimmie McAlpine retired and his son Robert James “Bobby” McAlpine became chairman. In 1991, Bobby appointed an external chief executive, and he left the chairmanship the following year. By then the family no longer held a controlling shareholding. Under subsequent management, the group continued to emphasize housebuilding, including through the acquisition of Raine Industries. By the late 1990s it was building more than 4,000 homes annually and ranked among the United Kingdom’s ten largest housebuilders. A proposed all-share merger with Amec Foster Wheeler was considered in the mid-1990s, but Alfred McAlpine’s board voted against the proposal. At the beginning of the twenty-first century, the company reassessed its portfolio. In August 2001, it sold the housebuilding division to George Wimpey for £461 million and indicated that more than £100 million would subsequently be returned to shareholders. It then expanded into support services and infrastructure management, acquiring Kennedy Utility Management in 2001 and Stiell in 2002. The company’s structure eventually comprised three principal streams. Business Services covered facilities management, information systems, asset management and health-and-safety management. Project Services included special projects for commercial, industrial, leisure, educational and medical facilities, together with civil engineering focused mainly on roads. Infrastructure Services provided maintenance, renewal and development work for gas, electricity, water and telecommunications operators, as well as roads maintenance for local authorities. Alfred McAlpine Slate remained a separate associated activity. In 2006, Alfred McAlpine began its largest facilities and building-management services contract, covering Mapeley’s entire United Kingdom property portfolio. By that stage, about three-quarters of company activity was in the private sector. In February 2007, the group disclosed a £13 million impact from serious accounting irregularities at its slate subsidiary. The irregularities were later linked to deliberate, multi-year collusion among managers, and former managers admitted fraud-related offences. The episode created uncertainty over the future of the slate business. Carillion approached Alfred McAlpine twice in 2007, but the approaches were initially rejected. In February 2008, Carillion completed an acquisition valued at £572 million. The deal ended Alfred McAlpine’s existence as an independent listed company and made Carillion Britain’s largest support-services company at that time. Carillion began selling or reorganising portions of the acquired business during 2008. Alfred McAlpine is therefore principally remembered as a former British construction group whose trajectory moved from regional civil engineering and motorway construction into housebuilding and, finally, facilities and infrastructure services.

1. 2008Acquired by Carillion

   Carillion acquired Alfred McAlpine for £572 million, ending its independent listed-company status.

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2. 2007Slate-business accounting irregularities disclosed

   The group recorded a £13 million impact after identifying serious accounting irregularities at its slate subsidiary.

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3. 2006Large Mapeley facilities-management contract begins

   The company commenced its largest facilities and building-management services contract, covering Mapeley’s United Kingdom property portfolio.

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4. 2002Acquisition of Stiell

   The purchase of Stiell strengthened the group’s facilities-management and information-technology network-systems capabilities.

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5. 2001Housebuilding division sold to George Wimpey

   Alfred McAlpine sold its housebuilding operations to George Wimpey for £461 million.

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6. 1985Public identity changes to Alfred McAlpine PLC

   The company adopted the Alfred McAlpine PLC name and expanded beyond the former north-western geographical restriction.

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7. 1978Entry into housebuilding through Price Brothers

   Alfred McAlpine acquired Price Brothers as part of its diversification into private residential development.

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8. 1960Expansion through motorway construction

   The company became a significant participant in Britain’s post-war motorway-building programme.

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9. 1958Floated as Marchwiel Holdings

   The company was listed on the London Stock Exchange under the name Marchwiel Holdings.

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10. 1940Legal separation from Sir Robert McAlpine

    Sir Alfred McAlpine & Son was formed as a legally distinct business.

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11. 1935North-western operations become independently managed

    After the deaths of Sir Robert McAlpine and his eldest son, Alfred McAlpine took responsibility for the family business’s north-western operations.

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A diversified British construction and infrastructure-services group combining civil engineering, road building, building construction, housebuilding, facilities management and utility maintenance.

• Construction servicesBuilding construction

  Alfred McAlpine undertook commercial, industrial, leisure, educational and medical building projects. Its special-projects activities complemented the group’s civil-engineering and infrastructure work and formed part of its broader transition from a regional contractor into a diversified construction and support-services group.

• Civil engineering and motorway constructionCivil engineering

  Civil engineering was the company’s original core capability and remained central during the post-war motorway programme. Alfred McAlpine became a major British road builder, with historical accounts attributing more than 10 percent of Britain’s motorways to the company. Its later road work included participation in the CAMBBA consortium for the M6 Toll.

• HousebuildingResidential construction

  The company entered private housebuilding during the 1970s through acquisitions and expanded the activity during the 1980s and 1990s. It acquired Price Brothers, Finlas, Canberra and later Raine Industries, while also investing in the United States housing market. By the late 1990s it was building more than 4,000 homes per year. The division was sold to George Wimpey in 2001.

• Facilities managementBusiness services

  Following its strategic shift away from housebuilding, Alfred McAlpine developed facilities, building and asset-management capabilities. Business Services included facilities management, information systems, asset management and health-and-safety management. The company began a major contract for Mapeley’s United Kingdom property portfolio in 2006.

• Utility infrastructure servicesInfrastructure services

  Infrastructure Services supported gas, electricity, water and telecommunications operators through maintenance, renewal and development work. The group also provided roads maintenance services to local government, giving it exposure to recurring infrastructure-support activities in addition to conventional project construction.

• Natural slateQuarrying and building materials

  Alfred McAlpine owned and operated Penrhyn Quarry in Wales through its slate business. The quarry was described as the country’s largest slate works, and slate from the operation was occasionally used in the group’s other construction activities. The subsidiary became associated with accounting irregularities disclosed in 2007.

• 2008Acquisition by CarillionM&A

  Carillion had made two unsuccessful approaches in 2007 as the British construction and support-services sector continued to consolidate.

  What changed. Carillion acquired Alfred McAlpine for £572 million.

  Aftermath. Alfred McAlpine ceased to operate as an independent listed company, and Carillion began selling or reorganising parts of the acquired business.

  Acquisition value. £572 million (February 2008)

  • Carillion plc — Completed the acquisition and became Britain’s largest support-services company at the time.
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• 2001Exit from housebuildingStrategy

  Housebuilding had become a major source of group profits, but Alfred McAlpine was reassessing its long-term portfolio at the beginning of the twenty-first century.

  What changed. The company sold its housebuilding operations to George Wimpey for £461 million and planned to return more than £100 million to shareholders.

  Aftermath. The divestment accelerated the group’s move toward facilities management, infrastructure maintenance and other support services.

  Sale consideration. £461 million (August 2001)

  • George Wimpey — Acquired Alfred McAlpine’s housebuilding operations.
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• 1983Expand beyond the historic regional restrictionStrategy

  A historical non-compete agreement had restricted Alfred McAlpine largely to civil engineering in north-west England.

  What changed. The geographical restriction was removed, enabling the company to pursue work across a wider United Kingdom market, although other terms of the relationship remained contentious.

  Aftermath. The change supported the company’s later national expansion and contributed to legal disputes concerning continuing obligations between the two McAlpine businesses.

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• 2007Accounting fraud at Alfred McAlpine SlateControversy

  A review of the slate subsidiary found serious accounting irregularities spanning several years. The company recorded a £13 million impact, and the conduct was attributed to deliberate collusion by multiple managers. Former managers later admitted fraud-related charges. The matter created uncertainty over whether Alfred McAlpine would retain its slate activities.

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• 2008Carillion acquires Alfred McAlpine

  Carillion acquired Alfred McAlpine for £572 million. The transaction ended Alfred McAlpine’s independent listed-company status and initiated the disposal or integration of parts of its business.

  M&ALeadership change
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• 2007Carillion makes takeover approaches for Alfred McAlpine

  Two takeover approaches from Carillion were rejected by Alfred McAlpine before the parties later reached an acquisition agreement.

  M&A
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• 2002Alfred McAlpine acquires Stiell

  Alfred McAlpine acquired Stiell, a facilities-management and information-technology network-systems business, for £85 million.

  M&A
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• 2001Alfred McAlpine sells housebuilding operations to George Wimpey

  The company sold its housebuilding activities to George Wimpey for £461 million as part of a strategic move away from residential development.

  M&A
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• 2001Alfred McAlpine acquires Kennedy Utility Management

  The acquisition expanded Alfred McAlpine’s presence in utility and infrastructure management services.

  M&A
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1. Alfred McAlpine