PRIVATE equity group Blackstone is poised to take a £160 million stake in debt-laden Scottish housebuilder Miller Group.
Miller has had a torrid time during the property crash, posting a loss for each of its three last financial years, exacerbated by a debt load that at one point approached £1 billion.
But it remains one of the UK’s largest privately owned construction groups. If the deal with Blackstone subsidiary GSO Capital Partners is confirmed, it could open a new chapter in Miller’s history as it forms the base for a consolidation vehicle for the sector.
Up until 2007, the group had 12 years of rising earnings.
But it has posted large losses since the property bubble bust in 2008 and has laid off hundreds of workers.
Miller Group sold 1915 homes last year, 7% down on 2009 but has signalled that home sales started picking up earlier this year. It retains substantial interests north of the Border including developments at Glasgow Zoo, the former site of Leverndale Hospital in the city’s Crookston area and Highfield Manor in East Kilbride.
It also has a strategic landbank totalling 5000 acres, including a number of greenfield sites not yet allocated for housing.
The key issue for Miller Group is its debt pile which, while it has been cut from a peak of around £1bn, still stands at around £600m. This must be refinanced in 2012.
Blackstone is understood to have become involved with Miller after it hired advisers from Greenhill to help the company find an investor that is willing to inject fresh equity capital to ease this process.
Miller Group is headed by Keith Miller, the son of one of three brothers who co-founded the group 74 years ago, who with his sister owns around half the group.
In 2008 Bank of Scotland, now part of Lloyds Banking Group, took a stake in the business, as part of a deal to buy out disgruntled family shareholders.
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