East London housebuilder Telford Homes has bought contractor Clifford Contracting from Puma Venture Capital for £6.3m
The deal will be funded by £5.7m of loan notes and the remainder will be in shares.
In a statement, the company said the addition of a contracting business would allow it to fund stalled developments and unsold properties at more attractive terms than bank financing.
The loan notes, which are repayable by June 2014, will be secured against property – primarily failed completions – that will be transferred to a subsidiary company.
Clifford Contracting had an estimated operating profit of £35,000 in the year to 30 April 2009 and cash of £6.3m.
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