Legal & General picks up remaining stake in Cala Homes for £315m

New Home Sales Increase Despite Rising Mortgage Rates
Legal & General in deal for upmarket housebuilder Cala (Source: Getty)

Insurance giant Legal & General has agreed to a £605m takeover of housebuilder Cala, it confirmed this morning.

L&G has agreed to pay approximately £315m to acquire the 52 per cent of Cala it does not currently own.

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Kerrigan Procter, chief executive of Legal & General Capital, said:

Legal & General is delighted to assume full ownership of Cala Homes, a growing business which we know and understand well. It has a strong management team with proven experience of managing a housebuilding business across business cycles, and has delivered great returns for shareholders since its acquisition in 2013, having tripled in revenue during this time.

L&G acquired Cala in 2013 with private equity group Patron Capital for £210m taking 46.5 per cent stakes in the business with Cala’s management holding the remaining 7 per cent.

Investment bank Lazard has reportedly being trying to find a buyer for Cala over the last 18 months, holding talks with prospective buyers which included Chinese property group Evergrande.

Read more: Developers hit out at accusations of landbanking by local councils

In its financial results for the 12 months to June 2017, Cala increased its revenue by 27 per cent to £747.9m and boosted pre-tax profits by 14 per cent to £68.5m.

In January it said that it expected to record a sixth year of revenue and profit growth in 2018.

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