Management buyout at PJ Walls in deal worth over €10m

PJ Walls has spun off its profitable building business from its indebted holding company in a €10 million-plus deal partially backed by some of its shareholders.

PJ Walls Holding Group has sold Walls Construction to its managing director Eugene O'Shea, and his colleagues, Willie White, Joe McGillycuddy, John Cahill, Adrian Corcoran and Frank Kelly. A group of private investors, including the managing director's brother, Gerard O'Shea, and John Collins, Gerry Harrington and Peter Boylan, are backing the deal, which is said to be worth more than €10 million.

Debt

An investment vehicle headed by Dr

Joe Walls

and

Aidan Walls

, who are also significant shareholders in PJ Walls Holding Group, is taking a minority stake in the building business.

The deal means that the ownership of Walls Construction has changed and the company is now separate from the holding group. It is on track to turn over €100 million this year and €125 million in 2016.

PJ Walls Holdings Group itself had total long- and short-term debt of €94 million at the end of 2012. Its creditors were the National Asset Management Agency (Nama), Bank of Ireland and KBC.

Its 2013 figures are due shortly. The sale of Walls Construction and a building business in Britain last year leaves the holding group with its development properties and the debts secured against them. One of its main assets is the Northern Cross development in north Co Dublin.

Contracts

In 2013, Walls Construction wrote off €19.2 million due to it from its parent company. A statement issued yesterday said that this paved the way for the management buyout.

The management saw off a number of competing bids for the business. The building company is understood to be profitable. Its operations generated a €1 million surplus in 2013, before taking the €19 million write-off into account. Walls Construction high-profile projects, include the new Central Bank building on Dublin’s docks, which is an €80 million contract and the €15 million redevelopment of Dublin Airport Authority’s offices.

Recently it completed a €30 million fit out for internet giant, Google, and €50 million worth of private hospital work for the Mater and Blackrock in Dublin and St Luke's in Kilkenny.

Its contracting work is split 50/50 between the State and the private sector. Its managing director Eugene O’Shea said that the buyout would put Walls in a strong position to benefit from the upturn in construction.