Crest Nicholson plans stock market return to raise £50m to pay off debts

Written on:January 21, 2013
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English cottages in Cambridge

Crest Nicholson returns to stock market after five years of struggle

Crest Nicholson is all set to return to the stock market with the announcement of initial public offering (IPO), five years after it was taken over during the housing market crash. The Surrey-based house builder announced that the IPO would comprise of new and existing shares and that the primary proceeds from the offer, around £50 million, would be used to pay outstanding borrowings.

Founded in 1963, Crest Nicholson was bought by HBOS and Sir Tom Hunter, the Scottish entrepreneur, in a £715 million takeover at the peak of the housing market in 2007. Crest Nicholson is now in the hands of American hedge fund Varde Partners and Deutsche Bank after the downturn in the property market led to two debt restructurings in 2009 and 2011.

Crest Nicholson’s plan to return to the stock market will see Varde Partners and Deutsche bank sell some of their stakes. Majority-owner Varde Partners said that it expects the free float to be a minimum of 35% of the issued share capital of the house building group.

Crest Nicholson, which employs nearly 600 people, announced results today showing a 28% rise in revenues to £408 million, while profits of £62.1 million for the year to October 31 compared with a loss of £27 million a year earlier. The group has said it plans to increase production to 2,500 homes per year within the next four years. The 50-year-old house builder achieved sales of £408m, up from £319m a year earlier. Crest Nicholson ended the period with land having a development value of £3.9bn, 95% of which was in the south of England.

     

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