Tuesday, July 23, 2024

Merger to create “leading UK homebuilder”

Leicestershire-based housebuilding giant Barratt has revealed plans to acquire Redrow in a more than £2.5bn deal.

Redrow shareholders will hold approximately 32.8 per cent of the combined group and Barratt shareholders will hold approximately 67.2 per cent of the combined group.

David Thomas, group chief executive of Barratt, said: “We have great respect for Redrow, its overall strategy, its leadership and employees, and its high-quality homes and communities.

“This is an exciting opportunity to bring together two highly complementary companies, creating an exceptional homebuilder in terms of quality, service and sustainability, able to build more of the high-quality homes this country needs.

“The combined group would leverage the respective strengths of both Barratt and Redrow, delivering significant benefits to our people, our supply chains, and – most importantly – our customers.”

Barratt and Redrow generated aggregate revenue of £7.4bn in FY 2023, delivering total completions of 22,642.

Matthew Pratt, group chief executive of Redrow, said: “Redrow and Barratt combined creates a leading UK homebuilder. Together, we’ll be in a much better position to offer a broader range of high-quality and energy efficient homes to customers.

“The Redrow brand, with its premium, characterful homes, has an excellent reputation and will remain a key part of the combined group. As with Barratt, Redrow’s fifty-year success story is based on its people, products and supply chain partners.

“Both businesses are a great fit and there are many exciting opportunities to innovate and share knowledge across a range of different areas.”

Steve Morgan, Redrow’s founder, said: “During the 50 years since I founded Redrow, I could not be more proud of the unique reputation it has earned for building premium homes and thriving communities.

“Barratt is a home builder I have long admired due to their likeminded attention to quality. I am confident that the Barratt / Redrow combination with their three high-quality complementary brands, will create a standout home builder for the future and accelerate the delivery of much needed homes across the UK.”

Caroline Silver, Barratt’s non-executive chair, will lead the combined group as non-executive chair. Barratt’s chief executive, David Thomas, will be group chief executive of the combined group. Mike Scott, chief financial officer of Barratt, will be chief financial officer of the combined group, and Steven Boyes, chief operating officer and deputy chief executive of Barratt, will be chief operating officer and deputy chief executive of the combined group.

The board of directors will be a combined board comprising the existing executive and non-executive directors of Barratt, with the addition of Matthew Pratt, currently group chief executive of Redrow, who will join the combined group and assume the role of chief executive officer, Redrow, and group executive director, and Nicky Dulieu, currently senior independent director of Redrow, and Geeta Nanda, currently non-executive director of Redrow, who will both join as non-executive directors.

Barbara Richmond, group finance director of Redrow, has agreed to join the combined group to support the integration for a period of not less than 12 months.

The combined group will be renamed Barratt Redrow plc.

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