Housebuilder seeks shareholder approval for cash call

Redrow wants to ask its shareholders for a £100m rights issue to take advantage of cheap land deals during the recession.

According to the Mail on Sunday, Steve Morgan, Redrow’s founder and majority shareholder, is in support of the move.

Like most other housebuilders, Redrow has halved in size during the recession, going from employing 1,300 people in January 2008 to about 650 now. It revealed losses of £46m in February, but has managed to shrink its net debt to £215m, down from £269 at the tail end of last year.

A rights issue would allow it to take advantage of lowered land prices and build up its fortunes again as the market returns to strength.