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Skanska sells infrastructure unit to M Group Services

4 Dec 20 M Group Services has struck a deal to buy Skanska UK’s infrastructure services operation for £50m.

Skanska's highway maintenance business will become part of a new M Group company called Milestone Infrastructure
Skanska's highway maintenance business will become part of a new M Group company called Milestone Infrastructure

Skanska’s infrastructure services operation includes road and rail projects, has 1,500 employees and generated £320m of revenue in 2019.

The sale, expected to complete by March 2021, should take M Group Services’ annual revenues past £1.5bn.

Skanska said that the sale was “a key part of Skanska strategy to focus on its core operations in the infrastructure and building sectors”.

M Group Services has set up a new company, called Milestone Infrastructure Ltd, to which it is proposed the majority of the existing people in Skanska’s infrastructure services business will transfer their employment. Those working on rail contracts will transfer to M Group subsidiary Dyer & Butler, where they will become part of a larger rail business.

Milestone Infrastructure will operate as a standalone highways maintenance, street lighting and highways projects business under the continued leadership of managing director Adrian Cooke and his senior leadership team, M Group said.

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It joins Dyer & Butler, KH Engineering Services and Antagrade Electrical as a part of the M Group Services Transport Division. Adrian Cooke will report to Neil Edwards, managing director of the Transport Division.

M Group Services chief executive Jim Arnold said: “Strategic acquisitions are a core part of our strategy as we continue to enhance the scope of capability across our sector focused divisions. Skanska’s infrastructure services business has earned a strong reputation within the transport sector due to its consistent, quality delivery and innovative solutions which has led to strong and longstanding relationships being established with many local authority clients including Hampshire County Council, Oxfordshire County Council, Devon County Council and Cambridgeshire County Council in addition to the likes of Transport for London. We very much look forward to welcoming them to the group in 2021.”

On completion, the £50m acquisition of Skanska’s infrastructure services business will take the total number of acquisitions made by M Group Services’ to 12 since December 2016.

M Group services has been majority owned by private equity firm PAI Partners since July 2018.

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