GALLIFORD TRY this week said it hoped to tap into a profit upturn at Morrison Construction, after agreeing to buy the business from Anglian Water for £42M.
Galliford Try construction managing director Adie Sturgess said Morrison was 18 months into a three year recovery programme after making losses in 2003/4.
Morrison made an operating loss of £12.2M in the year to 31 March 2004 but recovered last year with an operating profit of £1.15M.
Anglian originally bought the Morrison business for £263M.
When (chief executive) Johnson Cox took up the reins two years ago Morrison was in a pretty shambolic state and there was pressure from shareholders to sell it, ' said an Anglian spokeswoman.
Cox decided to return the contractor to profit before selling Morrison Construction. Anglian retains Morrison's two facilities management businesses.
Merging Morrison and Galliford Try will create a major national contractor with a mbined turnover of around £950M. Sturgess said the merger was a good strategic fit as the two firms shared only two clients.
The move makes Galliford Try a major force in water industry contracting with framework agreements for Welsh Water, Thames Water, Yorkshire Water and United Utilities.
Galliford Try will also work across the highways, rail, health, education and property sectors.