Cala Homes valued at £605m as Legal & General takes over

CALA Homes has been valued at £605 million following the acquisition by Legal & General’s investment division of the 52.1 per cent of the housebuilder it did not already own, writes Kevin Scott.

In December, it was reported Cala was in talks over a sale. And in 2016 a takeover by Chinese property group Evergrande fell through. Reports of a stock market flotation have also circulated.

Legal & General said the Aberdeen-based group has performed strongly under its joint ownership with Patron Capital Partners.

Revenue in 2013, when the pair acquired Cala for £210m, was £241m. This grew to £748m in 2017, and profits have grown at a compounded annual growth rate of 12% over the last three years.

Legal & General believes that Cala has attractive growth prospects under its continued ownership based on Legal & General Capital’s long term approach to investing and the attractive market for housebuilding in the UK.

The acquisition cost of the 52.1% share capital owned by Patron was £315m plus additional transaction costs and financial adjustments to reflect the contribution of management and Patron during the period of joint ownership.

Alan Brown, chief executive of Cala Homes, said the deal marked “the start of another exciting new chapter” for the business”.