Purchase of Anton Bilton’s property assets will increase his shareholding to 58% and make him chairman
A director of the housebuilder Raven Mount, which is listed on the alternative investment market, is to inject his private property firm, worth £37m, into the business.
Anton Bilton, the director involved in the sale of the Raven Group, and his business partner Bim Sandhu, will be paid an initial £14.5m in Raven Mount shares. They will be paid a further £22m in shares if certain sites gain planning permission.
Under the deal Bilton will replace James Hyslop as chairman and Sandhu will become chief executive. Sandhu is also a director of Raven Mount. Their stake in Raven Mount will increase from 26% to 58%.
The deal is an attempt to resurrect Raven Mount, which has suffered from its exposure to the slowing luxury housing market in the south of England. Its pre-tax profit dropped 71% to £1m in the six months to 30 June.
The purchase of the Raven Group landbank will give Raven Mount a significant development pipeline of around 20 sites throughout Britain.
The deal, which has been recommended by the independent board of directors, must be approved at an extraordinary general meeting to be held on Monday, 13 December.
It is likely to be voted through as 45.4% of Raven Mount shareholders have already given their backing.
Raven Mount, which is being advised by West LB on the transaction, was formed in December last year when Bilton led a hostile takeover bid of Swan Hill.
Bilton had hoped to sell the business to quoted property company British Land but the talks broke down in May because of Raven Mount’s pension deficit.
Bilton said the Raven Group deal was the best way forward for Raven Mount.
“We had to look at reinventing the business because we couldn’t sell Raven Mount after the pension situation,” he said.
Raven Mount is to quit the luxury housing market and focus on
mixed-use development. Bilton hopes to capitalise on section 106 opportunities and the development and management of sheltered accommodation for the elderly.
Bilton said that the combination of housebuilding expertise at Raven Mount and the planning and development expertise at Raven Group provided useful opportunities.
However, Bilton said the company would not rule out working in any sector of the property market, in the UK or abroad, if market conditions changed.
Bilton is the grandson of the late Percy Bilton, whose company was bought by quoted property company Slough Estates in 1998 for £270m.