Bovis hires ex-boss of £1bn suitor it fought off

TROUBLED builder Bovis Homes has rejected a £1.1bn takeover bid from rival Galliford Try – and made its former boss the new chief executive.

Bovis, rocked by complaints from furious customers over shoddy workmanship, said the offer from rival Galliford ‘failed to reflect the underlying value of the business’.

It also announced that its suitor’s former boss Greg Fitzgerald, a highly respected industry veteran who spent 33 years at Galliford, will be chief executive from April 18.

Analysts are delighted and the shares rose 5.4pc, or 45.5p, to 892p.

Former Bovis boss David Ritchie quit in January following a profits warning and a barrage of complaints from customers.

Bovis has faced stinging criticism for offering families thousands of pounds to move into unfinished homes in a desperate bid to hit sales targets.

It has also set aside £7m to deal with complaints over shoddy workmanship. The company was last month named as the worst housebuilder in Britain as its rating as a builder was cut from three stars to two stars – the lowest ranking of the 34 firms in the industry survey.

The crisis left Bovis vulnerable to predators, but it has now fought off approaches from Galliford and Redrow.

The appointment of Fitzgerald was seen as a major coup with the 52year-old known for his ability to correctly call peaks and troughs in the housing market.

Fitzgerald, who set up two housebuilders that Galliford bought before eventually taking the helm at the enlarged group, retired last year. He will be paid an annual salary of £650,000 although his package could total £3.3m. ‘Bovis has a great brand, excellent people and a high-quality land bank,’ he said.

George Salmon, an analyst at Hargreaves Lansdown, said that the announcement had ‘ended any lingering doubts about its future as an independent business’.

And Charlie Campbell at Liberum upgraded his rating on the stock to ‘buy’ and said that Fitzgerald’s appointment ‘is genuinely a game-changer’.

Retirement home builder McCarthy & Stone reported a 25pc slump in half-year profits to £21.8m as it blamed uncertainty following the Brexit vote for a fall in sales. Shares fell 2.6p to 182.4p.

But shares in Telford Homes rose 8.5p to 368.25p after it said that profits and revenues hit a record high in the year to the end of March.