Small surveyor firms could be forced to consolidate if rum-ours that e.surv is looking to incorporate Barclays’ surveying and valuation firm Ekins and Cheltenham & Gloucester’s valuations arm prove to be true.
Last week, sources close to the deal revealed that if it takes place e.surv will instantly secure more than 30% of the surveying market, making it one of the dominant players alongside firms such as Countrywide and Connells.
Such economies of scale would allow e.surv to control prices and one industry expert warns that it could allow it to push down the rates it pays to individual surveyors.
He says: “E.surv is an aggregator, meaning it panel manages surveying cases. Independent surveyors will have no choice but to work for the companies with the highest market shares, meaning e.surv could dictate the prices it pays them.
“They may be forced to club to-gether to stay afloat.”
And another source says: “This move represents a risk to the market. Dominant firms can drive smaller ones out of business by competing on price. It’s not healthy to have just a few big players in any market. This deal would inevitably lead to consolidation.”
Brokers and lenders could also suffer if the deal goes ahead.
One broker who asked not to be named says: “Lenders are bound to be concerned about this deal as larger players in any market are able to dictate prices.”
E.surv and Ekins are part of Barclays Group. E.surv was acquired by Barclays Private Equity in July 2004 and trades under the holding company, Lending Solutions, headed by Simon Embley.
Ekins was acquired by Woolwich Property Services some 10 years ago. It carries out all surveys and valuations for Barclays Group.
A spokewoman for Barclays admits it is considering outsourcing surveys and valuations to a third party but says this is not a takeover move.
She adds: “We have not yet made a final decision.”
But Ekins staff have been informed about a potential outsourcing deal.
Both C&G and e.surv declined to comment.