A newly capitalised company, Merit Industrialised Construction, has launched under the familiar Merit name to revive the off‑site construction expertise lost when the original Merit Group went into administration in late 2025.
Building Better Healthcare spoke to CEO Tony Wells, about retaining the Merit identity, with him saying it was a deliberate choice, driven as much by investors as by legacy.
“When we were looking for investors, particularly the guys we’ve teamed up with, they felt that Merit had provided a distinct brand within off‑site manufacturing,” Wells said. “We’d spent 23 years building that reputation."
"Off‑site manufacturing has been part of what we’ve done since year two, we were very early into it, so everybody wanted to maintain it.”
The relaunch combines retained intellectual property, digital design systems and factory expertise with fresh funding and a revised corporate and governance structure.
New backing, broader ambition
Merit Industrialised Construction is backed by global modular specialist Modulex, supported by investor Red Ribbon Asset Management, and advanced manufacturing partner HBEM.
Wells described the backing as “critically important” to the relaunch.
“They were interested in our technology‑based solutions, the R&D we’ve invested in around industrial‑scale off‑site manufacturing, digital integration and parametric design,” he said. “Now we’re looking at artificial intelligence and how we bring an end‑to‑end digital solution into factory delivery. That was something Modulex was particularly interested in, as well as the opportunity for global rollout.”
Wells said discussions with Modulex and HBEM began during normal trading conditions, well before the business entered administration, and were not driven by a distressed sale process.
Modulex brings international reach and large‑scale manufacturing capability, and is currently investing in a new 40-acre 'mega factory' manufacturing facility in Mumbai to produce fully fitted steel modular buildings, bathroom pods and doors and windows.
HBEM adds expertise in delivering advanced manufacturing environments across sectors including biopharma, cleanrooms and data centres.
The relaunch was backed financially by a £396,000 acquisition of key assets from the former business and approximately £900,000 in shareholder equity to fund initial operations.
Learning from the past
The relaunch follows the collapse of Merit Group Services and related entities, whose administration left unsecured creditors owed around £17.4m and hundreds of jobs lost.
While Wells was reluctant to dwell on the specifics of the administration, he acknowledged that lessons had been learned.
“We had a successful company for over 20 years,” he said. “But if there’s one thing we reviewed internally, it’s that in recent years we became too concentrated in a limited number of market sectors.”
Going forward, the strategy is to restore a broader spread of activity across healthcare, biopharmaceuticals, cleanrooms, data centres and other high‑end industrialised environments.
“Healthcare is important, but it’s within a portfolio of off‑site manufacturing,” Wells explained. “What we do is design and build technically complex facilities end‑to‑end in factories: that’s our core capability.”
Healthcare remains a core market
Despite the emphasis on diversification, healthcare remains central to the relaunched business, particularly where technical complexity plays to Merit’s strengths.
“The more technical healthcare facilities, aseptic environments, theatres and specialist spaces, are where our product‑based approach has the biggest opportunity,” Wells said.
“We’ve spent years developing mature product sets for healthcare, and we can now roll those out quickly to deliver high‑quality facilities in a very short time.”
The company retains proprietary modular platforms such as FlexiPod and UltraPod, alongside digital design and manufacturing systems developed over the past eight years.
NHS disruption and rebuilding trust
The collapse of the original Merit Group had an immediate impact on several NHS schemes, including the £35m Berwick Community Hospital and a regional medicines manufacturing centre in Seaton Delaval, leaving Trusts scrambling to put contingency plans in place.
When asked about re‑engaging with the NHS, Wells was clear that the door is open.
“We’re 100% available to collaborate with the NHS,” he said. “Everything that former Merit offered is now part of this restart, and we’d be more than happy to work with previous or future NHS customers.”
On whether trust between the NHS and Merit will take time to rebuild, Wells struck a cautious but optimistic tone.
“For 23 years we delivered technically challenging projects in the UK and abroad to satisfied customers,” he said. “Many people are happy to see the opportunity to buy those same services again."
"All we can do is focus on delivering well and supporting our clients.”
Rebuilding manufacturing capacity
The relaunch also brings renewed focus on UK manufacturing, particularly in the North East, where Merit’s factory operations were based.
“We never left UK manufacturing,” Wells said. “We invested in the North East for 23 years, with apprenticeships, R&D and carbon reduction programmes. Factory 2 is still one of the largest off‑site manufacturing facilities in the UK, and we’re looking to maximise its capability with new projects.”
While international manufacturing may play a role as the business expands with Modulex, Wells emphasised that Merit remains a Northumberland‑based company with strong regional roots.
Looking ahead
Over the next 12 to 24 months, success will be measured by product development as much as project wins.
“It’s about rolling out the technology we were very close to delivering, digital automation, production planning, Q&A systems, and growing a healthy business that delights customers,” Wells said. “This is an opportunity to come back and produce a world‑class, made‑in‑Britain product.”
As Merit Industrialised Construction begins operations under its familiar name, the industry will be watching closely to see whether fresh capital, broader markets and strengthened partnerships can deliver the reliable, factory‑led construction model that healthcare clients increasingly need.