Bovis Homes has agreed to buy Galliford Try’s housing businesses in a deal that values the business at £1.1bn
Further to the announcement on 10 September 2019, the board of Galliford Try has revealed that it has entered into an agreement with Bovis Homes regarding a combination of Linden Homes and Partnerships & Regeneration divisions.
The agreement will give Galliford Try shareholders a 29.3% stake in Bovis Homes, worth £675m.
Transaction terms include, the payment of £300m in cash to Galliford and the assumption by Bovis Homes of Galliford Try’s obligations under its £100m 10-year debt private placement
The deal will see Bovis Homes become a top five housebuilder and will go before shareholders on 2 December with completion expected on 3 January.
Once the transaction is complete, Bovis Homes will also assume Galliford Try’s rights and obligations under two of Galliford Try’s pension schemes.
The Galliford Try board believes the proposed transaction will:
- Allow Galliford Try to realise an appropriate premium for the Housing Businesses;
- Result in Galliford Try shareholders having investments in two focused and well-financed businesses, through their continuing 100% shareholding in Galliford Try, and a 29.3% shareholding in the enlarged Bovis Homes;
- Create, through the enlarged Bovis Homes, one of the UK’s leading housebuilding businesses; and
- Transform Galliford Try into a well-capitalised, standalone construction-focused group.
In addition, the Bovis Homes Board believes transaction will achieve estimated recurring run-rate pre-tax cost synergies of at least £35m per annum by the end of the second full financial year following Completion.
Peter Ventress, chairman of Galliford Try plc, said: “This transaction is a positive development which is in the best interests of both our shareholders and wider stakeholder group. For Galliford Try, it establishes a focused and well-capitalised construction business led by a very experienced and dedicated management team.
“Supported by a robust order book and strong market positions in key sectors, Galliford Try will be well positioned for the future. This transaction also creates one of the UK’s leading Housebuilding and Partnerships businesses with great opportunity ahead, from which Galliford Try shareholders will benefit through their continued shareholding.”
