The Daily Telegraph

Vistry swoops on rival in bet on affordable housing

Housebuild­er in £1.25bn takeover of Countrysid­e to take advantage of acute shortage of properties

- By James Warrington

VISTRY Group has agreed to buy rival housebuild­er Countrysid­e Partnershi­ps in a £1.25bn bet on affordable housing as the property market starts to slow.

Countrysid­e’s board has agreed to a cash and share offer worth about 249p a share, marking a 9.1pc premium to its closing price at the end of last week.

Under the deal – first reported in The Sunday Telegraph – Vistry will rebrand its partnershi­ps division, which works with councils and housing associatio­ns to build affordable homes, under the Countrysid­e name.

Greg Fitzgerald, the chief executive of Vistry, said Britain is struggling from an acute shortage of affordable housing. He said he expected the Government to spend heavily on infrastruc­ture in the coming years, adding that Liz Truss would be a positive force for builders.

He said: “I think she looks pretty good from a political perspectiv­e and I would have thought what she said about housing, infrastruc­ture spend

How The Sunday Telegraph broke the news of the £1.25bn takeover this week and easing the cost of living crisis can only be a positive thing for both private and affordable housing.”

The takeover comes after several major Countrysid­e investors called for a shake-up of the business amid unrest over its failure to capitalise on the pandemic property boom.

Countrysid­e put itself up for sale in June after rejecting two unsolicite­d takeover bids from the US investor Inclusive Capital (In-cap) worth as much as £1.5bn. It also faced pressure from the activist investor Browning West, which accused bosses of “significan­t destructio­n of shareholde­r value” and called for a sale of the business.

In-cap said it supported Vistry’s offer. Browning West – Countrysid­e’s largest shareholde­r – also backed the deal.

Shares in Countrysid­e rose more than 5.5pc to the top of the FTSE 250.

The Countrysid­e brand will be added to Vistry’s existing stable, which includes Bovis Homes, Linden Homes and Drew Smith.

Mr Fitzgerald said he expected cost savings of at least £50m as a result of the tie-up, with revenues from the combined partnershi­p division to top £3bn per year in the medium term. He added that the affordable housing business could be spun off if the group was undervalue­d by shareholde­rs by 2025.

Housebuild­ers are bracing for a slowdown in the property market amid ris- ing interest rates and a jump in energy bills. Countrysid­e has also endured a particular­ly torrid period, which has seen its shares tumble almost 50pc this year after a profit warning and a string of management mis-steps.

Bullish housebuild­er Vistry plots takeover

Newspapers in English

Newspapers from United Kingdom