Crest Nicholson has rejected two takeover bids from Bellway over the last two months, with the former saying that the recent £650million offer “significantly undervalued” the company.
Both housebuilders released statements to announce the rejected offers to the stock market.
The second offer from Bellway was made on 7 May, in which it made an attempt to buy the entire share capital of the smaller housebuilder. Bellway last reported a turnover of £3.4billion, while its rival’s turnover stands at £900million.
Under the unsuccessful £650million deal, shareholders of Crest Nicholson shareholders would receive 0.093 shares in Bellway for each share they hold, which would have an implied value of 253p per share with a premium of around 18.8%. Crest would have held 17% of the enlarged group’s share capital.
A spokesperson for Bellway said: “The board of Bellway believes there is compelling strategic and financial rationale for a combination of Bellway and Crest Nicholson which would bring together the strength of each business with complementary brands”
On the other hand, a spokesperson for Crest Nicholson said that the offer “significantly undervalued Crest Nicholson and its future standalone prospects and was not in the best interests of Crest Nicholson’s shareholders”.
An initial lower offer was made by Bellway on 25 April, but this was also unanimously rejected by the Crest board. Bellway now has until 11 July to submit a new offer or it must withdraw from the attempted takeover.
If the takeover was to be successful, the new business would have a turnover in the region of £4.3billion making it the second largest in the UK.
