Elliott-backed Avant tables rival takeover bid for Crest Nicholson

5 July 2024, 08:38 | Updated: 5 July 2024, 12:19

A housebuilder owned by the investment firm Elliott Advisors has tabled a secret takeover offer for Crest Nicholson, its London-listed rival.

Sky News has learnt that Avant Homes, which is run by former Persimmon chief Jeff Fairburn, made an all-share proposal to the board of Crest last month.

The bid, which City sources said had been rejected by Crest's board in the last 10 days, would have seen Elliott become the biggest shareholder in the combined group, according to insiders.

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One said the combination risked representing an unattractive prospect for some Crest Nicholson shareholders.

Avant's interest comes weeks after Crest rejected a bid from Bellway, another London-listed housebuilder, that would have valued the target at about £665m.

Bellway now has a deadline set by the Takeover Panel to make a formal offer for Crest of next Thursday.

It is unclear if it intends to submit a revised offer.

"The board of Crest Nicholson evaluated the Revised Proposal with its financial advisers and concluded that it significantly undervalued Crest Nicholson and its future standalone prospects and was not in the best interests of Crest Nicholson's shareholders," it said last month.

"The board therefore unanimously rejected the revised proposal on 14 May 2024."

A prospective bidding war for one of Britain's largest housebuilders would thrust an industry that will be at the centre of the new Labour government's policy agenda back into the City spotlight.

Labour pledged in its manifesto to build 1.5 million homes during its first five-year term.

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Housebuilding stocks responded positively to Labour's landslide victory on Friday morning, with gains for Persimmon, Barratt Developments and Taylor Wimpey.

Persimmon is already contemplating a bid for Cala Group, which is owned by Legal & General, while Barratt and Redrow agreed a £2.5bn merger earlier this year.

On Friday morning, shares in Crest Nicholson were up about 1.4% to 248p, giving the company a market capitalisation of £628m.

Avant is chaired by Mr Fairburn, who left Persimmon in 2018 amid a City outcry over his vast pay package.

Elliott engineered a deal to buy Avant through Berkeley DeVeer.

HSBC and Bank of America are advising Avant on its interest in Crest, which is being advised by Barclays and Jefferies.

Elliott and Crest both declined to comment.

(c) Sky News 2024: Elliott-backed Avant tables rival takeover bid for Crest Nicholson