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L&G acquires remaining stake in £600m housebuilder Cala Homes

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13th March 2018
"Legal & General is delighted to assume full ownership of Cala Homes, a growing business which we know and understand well."

Legal & General's capital division has acquired full ownership of Cala Homes after previously owning 47.9%.

Cala Homes paid £315m for the additional 52.1% to buy out joint owners Patron Capital Partners, with the total value of the business totalling £605m.

Under joint ownership, Cala's revenues increased from £241m in 2013 to £748m in 2017.

However L&G said in its statement that if it had owned 100% of Cala during 2017, the operating profit before tax would have been £91.5m. L&G reported pre-tax profits of of £42.5m for its 47.9% stake in Cala Homes in 2017.

Kerrigan Procter, CEO of Legal & General Capital, said: "Legal & General is delighted to assume full ownership of Cala Homes, a growing business which we know and understand well. It has a strong management team with proven experience of managing a house building business across business cycles, and has delivered great returns for shareholders since its acquisition in 2013, having tripled in revenue during this time. I am excited to be working with the team as Cala Homes continues to develop and grow under our continued ownership.

"Legal & General has valued the contributions of Patron over the past years and is pleased to have successfully grown the business together."

Alan Brown, chief executive of Cala Homes, commented: "Today’s investment by Legal & General marks the start of another exciting new chapter for Cala Homes and is a fantastic endorsement of our growth potential from one of the UK’s most highly-respected, blue-chip investors who shares our long-term vision.

"Over the past five years we have become one of the UK’s fastest growing house builders and this is testament to the strength and ambition of our team, the quality of our homes and our approach to customer service. We have also benefitted from the on going backing of our shareholders and I would like to take this opportunity to thank Patron for their support alongside Legal & General."

Keith Breslauer, Managing Director of Patron Capital, added: "With the combined resources of Patron and Legal & General, we have worked successfully with the management team to support the growth of the business and consolidate Cala Homes’ position in the market. Over the last five years, Cala Homes has expanded significantly, growing twofold the annual volume of homes sold and fourfold the operating profits, delivering on the business plan set out at the time of Patron and Legal & General’s acquisition.

"Patron wishes to thank the Cala management for delivering on the plan and Legal & General for its support of the investment; we are confident that the business will continue to grow and thrive under Legal & General’s ownership. Patron remains committed to the UK residential sector with our extensive investment activities in this area."

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