Bovis rejects two merger bids, but remains in talks with Galliford Try

Redrow proposed a share and cash transaction for the company and Galliford Try proposed an all-share transaction.

The Bovis board reviewed the proposals but concluded that neither reflected the value of the business and should be rejected. The board also concluded the Redrow proposal was not in the interests of Bovis shareholders.

After rejecting the proposals Redrow said it was not willing to improve its offer and discussions have ended. Discussions with Galliford Try are ongoing.

Under Redrow’s proposal Bovis shareholders would own approximately 32.4% of the combined group on a pro forma basis.

In an announcement to the stock market, Redrow said it “continues to believe the potential combination offers a compelling opportunity to create a combined business with the scale and operational strength to compete more effectively in the growing UK housebuilding market”.

Galliford Try said a merger with Bovis could create a “new major house builder with national scale and geographic coverage through the combination of the sixth and eighth-largest UK house builders by completions”.

Bovis would also benefit from Galliford Try’s “leading” position in affordable housing and regeneration, the house builder added.

Galliford Try proposed the equity in the combined group would be split 52.25% to Galliford Try shareholders and 47.75% to Bovis shareholders.