LONDON (Reuters) - Housebuilder Crest Nicholson agreed on Thursday to a long-awaited takeover by a consortium of HBOS and property magnate Tom Hunter, valuing it at around 715 million pounds.
Castle Bidco, which already owns 23.3 percent of Crest (CRST.L), said it would pay 620 pence a share in cash for each Crest share and a final dividend of 9.7 pence per share would be paid by Crest.
“The board believes that this deal with Castle Bidco delivers fair value to shareholders. The board also see it as a positive development for the business and its prospects,” Crest Nicholson Chairman John Matthews said.
Castle Bidco said the offer represented a premium of 10.2 percent over Crest Nicholson’s closing share price of 571.5 pence on November 9, the day before Crest said it had received an approach.
Analysts at Bridgewell said the offer represented 2 times its December 2007 net asset value estimate for Crest, compared to a sector average of 1.6 times.
“In our view the deal shows the appetite for private equity investors to pay a full price for a house building business, which has asset backing and a strong regeneration focus,” Bridgewell said.
The group, which posted a 1 percent rise in annual pretax profit to 80.1 million pounds in January as turnover fell slightly to 690.7 million pounds, rejected a 585 pence per share offer in November.
HBOS has worked with Hunter on a number of deals, including bids for retirement homes firm McCarthy & Stone, retailer House of Fraser and garden centre chain Wyevale.
The Sunday Times Rich List ranks Hunter, who made his fortune in property and sports retail, as the 72nd richest person in Britain, with 780 million pounds.
Shares in Crest were up 0.5 percent at 613 pence by 11:05 a.m.
Crest Nicholson is being advised by Dresdner Kleinwort. Rothschild and Panmure Gordon are acting as financial adviser and broker, respectively, to Castle Bidco.