Homebuilder McCarthy & Stone to go private in £630 million deal

FILE PHOTO: A man walks past hoardings advertising retirement apartments currently being built behind on site by McCarthy & Stone in London, Britain, October 10, 2018. REUTERS/Toby Melville/File Photo

(Reuters) - Retirement-home builder McCarthy & Stone Plc MCS.L on Friday agreed to be taken private by a unit of private equity firm Lone Star Funds in an all-cash deal that values the British company at 630 million pounds.

Shares in the London-listed firm jumped 43% to 118.4 pence, above the 115 pence per share offer, as the company said its board plans on unanimously recommending the deal to its shareholders.

McCarthy & Stone said the offer, which represents a 38.6% premium to its stock’s closing price of 83 pence on Thursday, would help it continue growing its shared ownership offering and access finance from private capital.

The company swung to a loss in the first half of 2020 as COVID-19 restrictions on housing transactions slashed its number of completed sales.

Mastiff Ltd, the unit of real estate-focused Lone Star Funds, said it had received an irrevocable undertaking from hedge fund Anchorage Capital for 17.1% of McCarthy & Stone shares.

Reporting by Aniruddha Ghosh in Bengaluru; Editing by Aditya Soni