Crest Nicholson board ‘minded to approve’ upped Bellway offer

Housebuilder Bellway has increased its offer for struggling rival Crest Nicholson to £720m . The board of Crest Nicholson said that it is minded to unanimously recommend to its shareholders to accept Bellway’s offer after two initial rejections. The previous £650m offer was made on 7 May, representing 0.093 Bellway shares for each Crest Nicholson share. Crest Nicholson has also extended the deadline for Bellway to “make a firm intention to make an offer” for Crest by no later than 8 August 2024, after having previously said that it had “until 11 July to make a firm offer or walk away”. Under the revised terms, Crest Nicholson’s shareholders would receive 0.099 shares in Bellway for each share they own in Crest Nicholson and a dividend of 4p per Crest Nicholson share comprising the previously announced interim dividend of 1p per share and a special dividend of 3p per share conditional on completion of the transaction. The £720m offer represents a 28.3% premium to the closing price per Crest Nicholson share on 13 June and has an implied value of 273p per Crest Nicholson share. The boards of Bellway and Crest Nicholson said that there is compelling strategic and financial rationale for a combination of Bellway and Crest Nicholson. In a joint statement, the boards said: “The revised proposal would bring together the strength of each business with complementary brands to reinforce Bellway’s position as a leading UK housebuilder, while enabling Crest Nicholson shareholders to benefit from the scale of the combined business. “In addition, the board of Bellway believes a combination would deliver significant operational benefits (including procurement synergies) and the ability to open dual outlets on at least 10 current and future Crest Nicholson sites with complementary brands to drive incremental volumes at attractive margins. “As part of the combination the board of Bellway intends to retain and deploy the Crest Nicholson brand across the enlarged group (including on Bellway sites).” Photo © Maureen McLean/Shutterstock