Mitie cancels sale of property management business

Mitie Group has pulled out of selling its profitable property management business after a disappointing level of interest from potential buyers.

After receiving an unspecified number of indicative offers, management "concluded that none were at a sufficient level with which to proceed", adding that the decision to retain Mitie the unit "provides clarity of ownership and reflects the board's view that there is greater shareholder and strategic value in keeping the business".

The embattled outsourcing group had put the property business up for sale in September as it carried out a restructuring programme following a series of profit warnings that led to worries about its balance sheet.

In September Mitie revealed it will cut around 480 jobs as a result of the transformation programme and announced that the property management business was being put up for sale, with a number of "indicative offers" received when half-year results were announced last month.

Bentley highlighted strengths Woolf would bring to the company, including being a "a highly-regarded leader" with "a proven track record in operational, financial and strategic oversight and execution".

The company's net debt as at 30 September 2017 had risen to £172.6m versus £147.2m at the end of the prior financial year, while Mitie's order book was £5.9bn

Chief executive Phil Bentley and chairman Derek Mapp recently appointed ex-Virgin Active boss Paul Woolf as the company's new chief finance officer, with Sandip Mahajan standing down from the board to take a newly created role of 'chief financial transformation officer' after less than 10 months as CFO.

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