Starting from scratch, TrueNorth Capital is targeting market leadership and an IPO next year.
A former construction company chief financial officer is busy shopping for companies to create a “construction supergroup”, zeroing in on three vertical specialisms – MEP, external envelope and facades, and manufacturing and offsite construction.
Bradley Lay, who spent nearly 17 years managing the finances of Essex Services Group (ESG) – during which time its turnover jumped from £12m to £150m – believes the unsafe cladding crisis revealed by the Grenfell catastrophe will create a multi-billion-pound remediation wave that a cladding-and-more specialist can tap into.
He has launched TrueNorth Capital Group with the aim of building a market-leading company capable of pursuing an IPO in 2027.
It has already bought Leeds-based KNG Building Services, a £10m-turnover MEP contractor in business for 40 years, and SME Funded, a provider of SME finance.
Lay told CM he has “heads of terms” agreements with three further companies, which are now doing due diligence. He expects to announce those deals in the coming months.
He said he was meeting a steel manufacturing company in the coming week.
Buy to grow
The idea is to replicate ESG’s success but more quickly with mergers and acquisitions (M&A).
“Rather than taking 16 years to organically grow from £12m to £150m, through M&A, we can scale very quickly by acquiring and building that group,” he said.
“That was the thinking behind why I wanted to launch my own private equity firm.”
The move is backed by family office capital.
As for the verticals targeted, Lay said he picked MEP because it was a founding ESG specialism, so he knows the business.
He believes cladding – for all the wrong reasons – will be a growth market.
Remediation nation
It seems a safe bet. In March last year, the House of Commons’ Public Accounts Committee estimated there were as many as 12,000 medium to high-rise buildings clad unsafely, with some 7,000 more yet to be identified.
The cost of remediation to public and private sectors could surpass £22bn, a figure the committee admitted was a preliminary estimate.
Up to three million people are affected, the committee said, with residents suffering “appalling financial difficulties and emotional distress while they wait for their homes to be made safe”.
In the meantime, they struggle with exorbitant insurance costs and can’t sell their homes.
Landlords face heavy liabilities. The Ministry of Housing, Communities & Local Government (MHCLG) updated its Remediation Action Plan in July 2025.
It gives owners of buildings taller than 18m until the end of 2029 to make their buildings safe or face criminal prosecution, with unlimited fines and/or imprisonment.
Landlords of buildings over 11m high must complete remediation in 2031 or face the same consequences.
Capacity gap?
Lay questioned the sector’s capacity to do all this remediation. “A lot of our competition is going by the wayside because a lot of these guys had legacy issues pre-Grenfell,” he said.
“There are lots of warranty claims and bits and pieces that they’re suffering with, and ultimately, a lot of them have ended up just winding their companies up. And also because it’s so specialist. There are a lot of companies trying to perform cladding and facades, but they suddenly realise it’s a lot more technical than they originally thought.”
He added: “It’s a very specialist type of installation. We’ve seen some horrendous cases where we’ve gone in to do a strip and reclad and as soon as we’ve taken the cladding off, it’s just like, oh my god, thank god there’s these regulations now because the workmanship’s just been terrible.”
Manufacturing and offsite completes the picture, Lay said, in particular with steel, since MEP and cladding use a lot of it.
“So if we’re looking at a data centre, for example, we’d have the ability to build the steel frame for the building, put all the external envelope on it and the roofing, and then fit it out internally with the MEP,” he said.
Willing sellers
With construction having so many SMEs, Lay believes there will be no shortage of owners interested in selling up.
He’s looking for profitable companies in the £10m-turnover range whose owners have limited succession options. “It gives owners an exit and also a home for the business they built,” he said.
“Because when I acquire a business, I’m not like other private equity firms who try to get synergies and cost savings and merge things together. I’m very much about keeping each business’s own identity and retaining the staff because, in my view, it’s the staff and the brand and everything that’s the goodwill of the business. So I’m a strong believer of ‘if it ain’t broke, don’t fix it’.”
