Property giant rejects £650m bid from rival firm

Crest Nicholson has rejected a £650m all-share offer from rival housebuilder Bellway, but the approach could trigger further interest in the firm.

Bellway revealed late last week that it had offered Crest Nicholson shareholders 0.093 Bellway shares for each of their shares in Crest Nicholson. This equates to an offer of 253p per Crest Nicholson share – a 19 per cent premium to Thursday’s closing price. It values the company’s shares at 0.79 times book value.

Bellway issued this response:

The Revised Proposal implied Crest Nicholson’s shareholders would own approximately 17.1% of the combined entity.

“Based on the Bellway share price of 2,718 pence as at close of business on 13 June 2024, the Revised Proposal represents an implied value of 253 pence per Crest Nicholson share, which represents a premium of approximately 18.8 per cent. to the Crest Nicholson share price of 213 pence as at close of business on 13 June 2024 and a premium of approximately 10.5 per cent. based on the 1-month volume weighted average share price of 229 pence per Crest Nicholson share.

“The Board of Crest Nicholson evaluated the Revised Proposal with its financial advisers and concluded that it significantly undervalued Crest Nicholson and its future standalone prospects and was not in the best interests of Crest Nicholson’s shareholders. The Board therefore unanimously rejected the Revised Proposal on 14 May 2024.

“The Revised Proposal follows an earlier unsolicited approach from Bellway on 25 April 2024 regarding a possible all-share offer for Crest Nicholson (the “Initial Proposal”) under which Crest Nicholson’s shareholders would receive 0.089 new ordinary shares in Bellway. The Initial Proposal was also unanimously rejected by the Board of Crest Nicholson on 2 May 2024, having concluded it fundamentally undervalued Crest Nicholson and its future prospects.

“As outlined in its half year results on 13 June 2024 for the period ended 30 April 2024, Crest Nicholson remains confident in its standalone prospects, in particular given conclusion of the review of provisions for completed development sites supported by external consultants, its highly attractive land portfolio and the new leadership of Martyn Clark.

“In accordance with Rule 2.6(a) of the Code, Bellway is required, by not later than 5.00 p.m. (London time) on 11 July 2024, being 28 days after 13 June 2024, the date of the announcement made by Bellway publishing details of the Revised Proposal, either to announce a firm intention to make an offer for Crest Nicholson in accordance with Rule 2.7 of the Code or to announce that it does not intend to make an offer for Crest Nicholson, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This deadline can only be extended with the consent of the Panel on Takeovers and Mergers in accordance with Rule 2.6(c) of the Code.

“This announcement has been made without the consent of Bellway.”



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