The shopper shopped
The City has been speculating about consolidation among the housebuilders for months. While the mega-mergers widely rumoured among the volume housebuilders including Persimmon, Barratt, Taylor Woodrow and George Wimpey have yet to occur, some of the smaller players have been busy hatching plans. Last month the Cherry family successfully took Countryside Properties private after a £222m management buyout. Then on Wednesday, Country & Metropolitan said it had received an approach from an undisclosed party.
Shares in the company have risen 10% since the beginning of February, prompting the takeover panel to force Country & Met to make a statement explaining that the uplift was largely the result of takeover talks.
Last week that statement pushed shares in the company up 19.5% to 282.5p, making it the best performer overall. A second statement from the company, a day later, said discussions “may not lead to an offer being made”, but the two parties are clearly a long way down the road. They have agreed a takeover bid of 300p a share, and the board is set to recommend it, according to the firm.
Country & Met has a market capitalisation of about £67m, which means that it is unlikely to be in talks with any of the volume housebuilders, who would probably rather spend that money on buying land.
City experts speculate that its suitor is more likely to be a private player such as Scottish group Miller. Gladedale’s name has also been thrown into the hat. It is understood that Gladedale was the mystery third party that offered to buy Countryside for 250p a share last year but was rejected.
It is not surprising that smaller firms such as Country & Met seek their fortunes as private companies. Philip Davies, who took Linden Homes private in 2001, says the beauty lies in controlling your own destiny and that the quoted sector belongs to the volume housebuilders.
The rest of the sector was relatively uneventful, although highlights included Gleeson, up 7% to 289.5p. Overall the construction sector remained at roughly the same level, dropping only slightly (0.4%) to 3534, as the All-Share rose slightly (0.6%) to 2527.
Angela Monaghan is business editor
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