- Offer represents a 9.1 premium to Countryside's value
- CSP shareholders to receive "mix and match" facility
Countryside Partnerships (CSP) has agreed to a £1.25bn takeover from its rival Vistry (VTY). The directors of both companies said the deal would create a £2.8bn housebuilder with the potential to generate £3bn a year in revenue.
Vistry’s offer represents a 9.1 per cent premium to the 228p value of CSP at the end of Friday. Shares were up 5.5 per cent on the morning of the deal.
Holders of Countryside will receive a “mix and match facility” giving them the ability to choose how many Vistry shares they want or how much equivalent cash they want in exchange for their Countryside shares. The cash offer is subject to the amount of cash available – meaning that not all Countryside shareholders will be able to opt for a 100 per cent cash facility.
The deal will see the Countryside brands added to Vistry stable, which include Bovis Homes, Linden Homes and Drew Smith. Vistry said Countryside could be spun off into a different business if the market does not recognise the full value of the combined company by 2025.
Vistry added that the new company would be “capital light” and target a 40 per cent return on investment. It added that Countryside’s timber frame business would give the new group more scale.
Major shareholders owning a combined 39.1 per cent in Countryside approved of the deal – including Inclusive Capital Partners, whose two bids to buy Countryside were rejected, and Browning West, who pushed Countryside to put itself up for sale back in June.
Countryside chair Douglas Hurt said the deal was “an opportunity to leverage both Countryside's brand and place-making experience with the growing Vistry partnerships business, alongside Vistry's established housebuilding business”.
Andy Murphy, director at investment researcher Edison Group, said: “The deal ‘feels’ like a natural home for the troubled Countryside business considering that Vistry is one of the few housebuilders that operates a partnership division at scale.
“Furthermore, under Greg Fitzgerald the Group has experience of combining businesses having previously bought the Linden Homes business from Galliford in recent years."
