Galliford Try agrees £1.1bn housing arm sale to Bovis
Galliford Try chief executive Graham Prothero will become COO at the enlarged Bovis Homes business
Galliford Try has finalised the sale of its Linden Homes and partnerships and regeneration arms to Bovis Homes for £1.1bn.
The cash and shares deal will see Galliford Try shareholders receive £675m worth of new Bovis Homes shares, while £300m will be paid in cash to Galliford Try. Bovis will also take on responsibility for £100m of Galliford Try’s debt.
The firms reached a preliminary agreement over the deal in September, after Galliford Try rejected a £950m bid from Bovis for the business in May.
It leaves Galliford Try, which recently restructured and cut 350 jobs after struggling with the £1.35bn Queensferry Crossing joint venture and the delayed Aberdeen Western Peripheral Route (AWPR) as a standalone construction business.
Graham Prothero, who is currently the chief executive of Galliford Try, will become the chief operating officer of the merged businesses following the deal. Greg Fitzgerald and Earl Sibley, currently the chief executive and group finance director of Bovis Homes will retain their positions.
The deal is now set to be voted on by shareholders and is expected to be completed on 3 January 2020.
Peter Ventress, chairman of Galliford Try, 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 pPartnerships businesses with great opportunity ahead, from which Galliford Try shareholders will benefit through their continued shareholding."
Greg Fitzgerald, chief executive of Bovis Homes said: “This is an exciting and transformational opportunity to create a leading UK housebuilder with an enhanced customer proposition and the ability to increase delivery to more than 12,000 new homes per year.”
He added: “The combination with Galliford Try Partnerships gives Bovis Homes a market leading position in the high growth, more resilient partnerships market, with significant potential to increase revenue and profit while delivering more affordable homes at a time when they are needed more than ever.”