SIG Building Systems, a subsidiary company of distributor SIG plc, has been sold to Manchester developers, Urban Splash Modular for a nominal fee of £1.
The sale includes SIG’s modular housing factory in the East Midlands, which employs 70 workers who will keep their jobs on the transfer.
SIG still owns the offsite construction business RoofSpace which makes room-in-roof panels.
SIG Building Systems had reported sales of £9.2m in 2016, but a pre-tax loss of £5.7m. Urban Splash has announced new investors in the modular housing business – Channel 4 presenter George Clarke and founder of WeBuyAnyCar.com Noel McKee.
Although SIG Building Systems was sold for a nominal £1, SIG will have to meet cash costs of £4.9m until 31 March 2020, which will be funded from its existing resources. It also expects to incur an exceptional charge of around £7.9m for the divestment.
Urban Splash chairman Tom Bloxham MBE said: “We are pleased to have agreed terms on this acquisition with SIG; Urban Splash is committed to expanding its offsite construction capacity and this purchase is a way to vertically integrate our business and give us control of the production of our houses. It is a testament to our commitment to, and investment in, modular housing.
“SIG has been a great company to work with but as the factory gradually filled up with Urban Splash product, it became clear to all that its natural home was with Urban Splash. We will continue to work with SIG’s excellent supply chain and welcome our great new colleagues from SIG into the Urban Splash team.”
Speaking of the new investors Bloxham added: “Noel disrupted the used car market with his invention of WeBuyAnyCar.com; in housing, we’re challenging another traditional market – new homes – so Noel’s wealth of knowledge is crucial for us as we look to move innovation forward in this sector.
“George will give us a brilliant design counsel; he shares our passion for the way architecture can transform our everyday lives and believes that houses are the single most important pieces of architecture – and that everyone has the right to a decent, well-designed home.”