History
ISG originated as Stanhope Interiors, which was founded in 1989 by David King.[1][2] During 1995, King led a management buyout of the firm from the indebted Stanhope in 1995, when it was renamed Interior plc.[3][4]
During early 1998, Interior PLC opted to move into construction management via the launch of a new subsidiary.[5] Around this time, the firm experienced a period of rapid growth.[6][7]
In 1997, the business, which was then trading as Interior Services Group, was floated on the Alternative Investment Market of the London Stock Exchange.[8] By this time, much of the firm's work involved kitting out offices across the City of London.[9] During 2003, it opted to reduce its presence in the poorly performing economies of France and Germany.[10] One year later, David King became Interior Services Group's chief executive while Roy Dantzic was appointed its chairman; other changes around this time included the sale of the firm's facilities management division to Erinaceous for £10 million.[11][12]
During 2005, Interior Services Group paid £12.5 million in exchange for the social housing specialist Propencity.[13] One year later, it also bought the facilities management firm ISG Asia for £4.6 million.[14] In 2007, the firm acquired the regional contractor Pearce Group in a deal that was potentially valued at around £20 million; this purchase expanded Interior Services Group's regional coverage, which had traditionally centred around the southern, eastern and northern regions into the west of England and South Wales, as well as expanding its presence in the affordable housing and student accommodation sectors.[15] That same year, it also purchased the fit-out specialist Cathedral Contracts in exchange for £11.8 million,[16] and technical consultancy firm Commtech Asia for £1.2 million.[17]
During the late 2000s, the company's profits and order book both dipped sharply; this was mostly attributed to the wider economic downturn known as the Great Recession.[18][19] In September 2011, Interior Services Group reported a record high in terms of revenue while profits for its struggling south west construction division had roughly halved.[20] During the early 2010s, the firm's then-chief executive David Lawther responded to the decline by reorienting the company towards the still-growing international market.[21][22] In April 2013, the firm officially changed its name to ISG plc.[23][24] That same year, its construction arm underwent restructuring, which involved the streamlining of its eastern construction division while retail activity was placed under a single management team.
In March 2016, ISG was taken private by the US-based firm Cathexis (the investment vehicle of Texan billionaire William Harrison), previously a substantial shareholder, in a £85m takeover.[26][27][28] At that time, the remuneration of ISG's highest paid director, David Cossell, tripled to £3m.[29]
In May 2021, ISG reported its results for 2020, affected by the COVID-19 pandemic. Revenue was down 23% to £2.0bn (2019: £2.6bn); underlying EBITDA for the year was £37.6m (2019: £63.3m).[30] Fit-out was ISG's biggest source of revenue (£1,042.3m in 2020), followed by construction (£690.8m) and engineering services (£293.3m).[31]
In the year to December 2021, ISG reported revenues of £2.263bn, still not back to its pre-pandemic peak, while pre-tax profits increased to £18.9m, from £8.9m a year earlier;[32] fit-out remained ISG's largest service line, the company had 3,001 employees and derived £1.8bn of its revenues from the UK.[33] In early 2022, ISG acquired a majority shareholding in ESS Modular, selling it later that year to Cathexis.[34] In 2022, ISG revenues slipped to £2.19bn, while pre-tax profit was down 38% to £11.5m.[35] ISG's order book was adversely affected by the August 2022 suspension of the Britishvolt gigafactory in Blyth, Northumberland, and delays to a film studio project in Hertfordshire.[36][37][38]
Appointed in 2022, Blowers left ISG as the business underwent a 'fundamental reset' in February 2024,[41] being replaced as CEO by Zoe Price.[35] There were also changes affecting the company secretary, vice-chair and chief financial officer roles;[42] in the last five years, ISG's highest-paid executive had been paid over £18m.[29]
In October 2023, a subcontractor's winding-up petition stoked staff and supplier concern about ISG's financial stability,[43] and the company began to look for a buyer or a cash injection from Cathexis. In July 2024, ISG finances incurred a £14m hit after a key supplier went into liquidation,[44] but, despite interest from 11 private equity and trade buyers, the sale process halted after ISG received an offer for the group; ISG staff and suppliers were told the company would be sold by Cathexis in the near future, and a significant investment would recapitalise the business and support a return to normal trading.[45] The prospective buyer was reported to be a UK-registered holding company called Antipodean Holdings with two equal shareholders: South African Andre Redinger and Australian James Overton.[46]
Administration
No further progress on the sale was announced. Administrator Ernst & Young (EY) later said that on 2 September 2024, Antipodean had dropped its offer to £1 while remaining committed to funding working capital needs.[47] However, Antipodean provided no evidence it had the necessary funds. ISG's board then reopened talks with a prospective buyer of ISG Fit Out, but this buyer later dropped out, amid concerns about the group's VAT debts and novation of contracts.[47]
Late on Thursday 19 September 2024, six ISG Ltd subsidiaries – ISG Construction, ISG Engineering Services, ISG Retail, ISG Jackson, ISG UK Retail and ISG Central Services – were reported to have applied to go into administration.[48][49][50]
