Gleeson rejects £177m bid from mystery AIM cash shell

MJ Gleeson, the engineering and housebuilding group, revealed yesterday it had rejected a £177m proposed reverse takeover by a shell company listed on the Alternative Investment Market. Gleeson did not name the bidder but said the party was unconnected with management and described it as "an AIM-quoted investment holding company with no active employees or connection with the construction, housebuilding or property sectors".

The 345p-a-share offer was made in shares, with a partial cash alternative. If taken only in shares, Gleeson investors would have ended up owning 97 per cent of the enlarged group.

The bidder wanted to retain Gleeson's top management, with jobs envisaged for the chairman Dermot Gleeson, chief executive Terry Massingham and finance director Colin McLellan. Gleeson would also nominate two of the four non-executive directors.

Gleeson shares closed up 13.5p at 347.25p yesterday. The company holds its annual meeting tomorrow, when it may say more about the takeover interest.

There has been consolidation activity in the construction and housebuilding sectors, with Mowlem currently at the receiving end of a bid and Laing recently rejecting an offer. Westbury has agreed to be bought by Persimmon.

Gleeson's construction business was spun off to a management buyout in July.