Date 10 Sep 2019
Galliford Try plc, the parent group of Morrison Construction, has announced it has reached preliminary agreement on high-level terms to combine its Linden Homes and Galliford Try Partnerships businesses with Bovis Homes plc.
The proposed Bovis consideration is valued to be worth £1.075bn, with a cash element of £300m and a further transfer of a £100m private debt placing to Bovis. The remainder of the offer is a £675m share issue of new Bovis shares to existing Galliford Try shareholders on a pro rata basis.
These steps combine to give the standalone Galliford Try plc a well-capitalised construction group, which together with the recent restructure and focus on its core operations, see the business in a strong position for the future.
The combination of Linden Homes and Galliford Try Partnerships with Bovis will create a business with an enviable position in the housebuilding sector, with extensive geographic coverage and a strengthened housebuilding and partnerships operating platform.
When finalised, the proposal will be taken forward for the approval of both sets of shareholders, with a view, if approved, to completing the transaction in the coming months.
Graham Prothero, Chief Executive of Galliford Try plc, commented: “The transaction is an exciting opportunity to create two strategically focused businesses. The significant cash element within the consideration provides a firm foundation for our newly reorganised Construction business to flourish as an independent company. The strong balance sheet and excellent fit between the combining businesses will be a superb platform for both private housebuilding and partnerships, creating a unique and well-positioned housing provider.
“Much remains to be done before we can present all the details to our shareholders and wider stakeholders. However, if completed, this deal will generate significant value for shareholders and a bright future for all three of our businesses.”