Bovis fends off Galliford — and nabs its old boss

BOVIS Homes today snubbed a £1.2 billion takeover bid from rival Galliford Try — and lured its former chief executive to be the new boss.

Greg Fitzgerald, who spent 33 years at Galliford, has the job of rescuing a Bovis which had lost its way. Earlier this year, it paid £7 million to compensate customers who needed repairs on newly built homes. It offered customers up to £3000 to move into unfinished homes so it could hit sales targets.

Bovis also rejected an 814p-a-share, £1 billion bid from Redrow last month and was seen as in turmoil at least until today’s announcement. Galliford said it realised it was never going to land the support of the Bovis board for its offer. Bovis said Galliford’s deal “failed to reflect the underlying value” of its business. Bovis shares moved up 3% to 872p on news of Fitzgerald’s appointment. Galliford was steady at 1471p.

Fitzgerald will replace David Ritchie, who left in January under a cloud after a surprise profit warning because of a delay in completing homes.

The housing boom and various government support schemes created a benign environment for the sector. Bovis shares have underperformed rivals, however. The firm said today that staff have been retrained and it is working on “customer service issues”.

Fitzgerald said: “Bovis has a great brand, excellent people and a high quality land bank. I very much look forward to working with the management team to restore Bovis’ position as a leading housebuilder.”

Fitzgerald is regarded as an oldschool operator who lives to work, once describing Galliford as his “entire life”. In an interview two years ago he described himself as “an entrepreneur first and foremost” and “not a natural large company Plc bod”.

He is often compared, favourably, with building legend Tony Pidgley of Berkeley, for his ability to call the housing cycle correctly. He replaces the interim chief executive Earl Sibley, who resumes his previous role as finance director.

Galliford, of similar size to Bovis, says it will now focus on a “five-year organic growth strategy”, seeming to rule out any prospect of a hostile bid. @SimonEngStand