Deal worth £27.5m comes after Inverness-based housebuilder postponed plans to float

The Bank of Scotland has acquired a 40% stake in £150m-turnover Tulloch Homes in its latest deal in the construction sector.

The deal, worth £27.5m, comes days after BoS announced it had bought a minority stake in Miller Group. The move comes three months after Inverness-based Tulloch admitted that the credit crunch had forced it to put plans for a flotation on ice.

Tulloch chairman and chief executive David Sutherland will remain the company’s largest shareholder with a 43% shareholding.

Sutherland said: "This is an excellent move for Tulloch Homes Group. We currently have a significant landbank at current volumes of five years across Scotland and this investment by Bank of Scotland will give us the opportunity to grow our business even further.

Gordon More, head of joint ventures transactions at Bank of Scotland Corporate said: "The deal fits perfectly with our ambition to invest in the North of Scotland housing market, which we see as having strong growth potential over the coming years."