One of the UK’s biggest suppliers of heating and renewable energy services has backed a £306 million takeover by support services giant Carillion.
Eaga, which was founded in 1990 and now employs around 4,000 people, works with the Government, local authorities and housing associations to lower carbon emissions and energy consumption, principally in low-income households.
The Newcastle-based firm is one of the UK’s largest installers of central heating systems and provides emergency breakdown cover and servicing for 160,000 local authority and social housing properties.
Wolverhampton-based Carillion said it had identified the low carbon market as a strategic area of growth and that the Eaga acquisition will create a platform to build the UK’s largest independent energy services provider.
Eaga’s board recommended that its shareholders back the 120p a share offer as it will be in a better position to realise its prospects as part of a larger group. Carillion acquired a further 12% of shares in Eaga in a move taking its stake in the company to 53%.
Carillion employs some 47,000 people in the UK and overseas, and generates sales of over £5 billion a year. Its portfolio of projects includes schools, universities, hospitals, roads, prisons and defence projects, the largest of which is the Allenby Connaught project for the Ministry of Defence involving the replacement and management of Army accommodation in the south of England.
It has also upgraded large sections of the UK rail network such as the West Coast Mainline and constructed the M6 Toll motorway.
Eaga generated revenues of £762.2 million in the year to May 31, while operating profits were £52 million.
Its chairman Charles Berry said: “The offer received from Carillion has come at an interesting time in Eaga’s development, as our markets are changing rapidly.
“While there are exciting future prospects, we believe these are potentially better accessed as part of a larger group.”