Hercules Site Services PLC (AIM:HERC) said it has taken a lease at an industrial site in the West Midlands where it expects a training academy will be constructed, as well as serving in the near term as a regional base.
Situated in Nuneaton, roughly 15 miles from the northern section of the HS2 phase 1 construction site, the company said it will initially use the site to store plant, machinery and suction excavators for its work on the high-speed rail project.
On top of that, the site will be used as a base for new fibre broadband work in the East Midlands, for general training purposes and as a more northerly base for its suction excavator business.
As it is located 65 miles north-east from its headquarters in Cirencester, Gloucestershire, Hercules’ management believe using the Nuneaton site will deliver efficiencies and cost savings through reduced travel times and storage costs.
Planning permission has also been sought to construct the Hercules Training Academy, the company said, with the aim of reducing external training costs for the company as a provider of skilled labour to the infrastructure sector and across its own workforce.
An academy will also allow Hercules to provide specific training for clients across the infrastructure and construction industries, which the company expects to generate further income streams and enable it to upskill workers to fulfil additional roles on client construction sites.
The site is currently owned by Hercules Real Estate Limited (HRE), a business that is majority owned by Hercules chief executive Brusk Korkmaz, which has stated its intention to finance the construction of the academy.
As the agreement, an 18-year lease with annual rent of £100,000 – but with the lease to be shortened when the training academy is constructed and a rent agreed at market rates, is a related-party transaction, the company’s nominated adviser SP Angel has been consulted.
Hercules chairman Henry Pitman said the agreement with HRE “marks the first step in the company's stated strategy to develop a training academy to provide much needed skills for the infrastructure sector in a bid to help tackle the UK's skills shortage”.
“We believe the site in the West Midlands will provide the company with an important base for the region and the north of England, where Hercules is experiencing an increase in work across all business areas. We look forward to providing further updates as this important project progresses."