April 9, 2020 / 6:45 AM / 2 months ago

Britain's Redrow gets approved for BoE's financing scheme, furloughs 80% workforce

FILE PHOTO: The company logo of construction company Redrow is pictured on a flag at a new housing development near Manchester northern England, April 7, 2016. REUTERS/Phil Noble

(Reuters) - Redrow was the first of Britain’s big housebuilders to say it had been approved for the Bank of England’s coronavirus emergency financing scheme on Thursday, adding that it had put 80% of its workforce on government-sponsored furloughs.

The company said it would have access to 300 million pounds ($371.61 million) in funding under the scheme(CCFF) and that talks with six banks to secure additional 100 million pounds were progressing well.

“The additional bank facilities remove any lingering fears that the group would look to raise fresh equity,” Peel Hunt analysts said.

Shares of Redrow rose 9% at the open to 440.8 pence at 0706 GMT.

As governments restrict public transport due to the virus outbreak, construction sites have shut to prevent workers travelling in confined spaces and gathering in large groups.

“The positive progress we have made on securing additional banking facilities means we can now finalise plans for our valued workforce and supply chain,” Executive Chairman John Tutte said.

The company said its board and senior directors had volunteered to take a 20% cut in salary.

($1 = 0.8073 pounds)

Reporting by Samantha Machado in Bengaluru; Editing by Sherry Jacob-Phillips and Vinay Dwivedi

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