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Bovis boss: Galliford Try acquisition will make Bovis ‘partner of choice’ for housing associations
The proposed £1bn acquisition of Galliford Try’s housing business by national house builder Bovis Homes would make the new organisation the “partner of choice” for affordable housing providers, the chief executive of Bovis Homes has said.
Speaking to analysts yesterday, Greg Fitzgerald said that the deal – which would see the house builder take on Galliford Try’s partnerships and regeneration business – would allow it to become the “go-to” for affordable housing providers at a time when affordable housing was most needed.
Yesterday, Bovis revealed that it had restarted negotiations and had agreed high-level terms with the construction giant to buy its housing businesses. The housing business includes its partnerships business and its private housebuilding business Linden Homes. The deal values Galliford Try’s housebuilding businesses at just under £1.1bn.
It comes after a £950m bid by Bovis for the businesses back in May was rejected by Galliford Try.
Mr Fitzgerald said that taking over Galliford Try Partnerships was a key reason for the deal, and that he believes the new business would be attractive for housing associations to partner with.
Galliford Try’s partnerships business currently works with nearly 70 housing associations, and last year achieved profits of £14.5m on a turnover of £284.9m.
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Mr Fitzgerald said: “From the feedback I have got from the sector, housing associations would welcome Galliford Try coming over to us.
“Housing associations say there is a lack of competition in the sector and feel like they only have one or two people to turn to and that is one of the reasons we are going in.”
He said Galliford Try Partnerships is a “great brand” and is considered the best business for delivering affordable housing by the government’s housing delivery body Homes England.
If the deal goes through, it would see Galliford Try Partnerships merge with Bovis Partnerships. Bovis Partnerships was launched in February to deliver land-led joint ventures with housing associations.
Since its launch, Bovis Partnerships has already agreed six partnerships with five housing associations. These include a 1,558-home development with Riverside at Stanton Cross, Wellingborough; a 1,496-home site with Clarion in Sherford, Plymouth; and two schemes with LiveWest that would see more than 1,000 homes built.
Yesterday, Bovis published its half-year accounts for the six months up to 30 June, and revealed profits for the period of £72.4m, up 20% on last year’s figure of £60.2m.
The accounts also revealed a rise in affordable homes built – from 550 for the six-month period last year to 616 for the same period this year.
Earlier this year, Bovis Homes revealed that it was one of a handful of house builders that had agreed “bulk sale deals” with housing associations, which means it would sell a number of homes at discounted rates.
Earl Sibley, group finance director at Bovis, said that the company had done bulk sale deals with a dozen housing associations over the six-month period with a modest discount.
