Barratt has agreed an all-share deal valued at £2.54billion to buy Redrow.
The offer will see each Redrow share receiving 1.44 Barratt shares, with Redrow shareholders holding just under a third of the equity of the merged company, Barratt Redrow. The financial terms of the agreement were unanimously approved by the Redrow board, representing a premium of 27.2% for Redrow investors.
The statement released by both developers said that the merger will “accelerate the delivery of the homes this country needs” and allow the company to better navigate market challenges.
The founder of Redrow, Steve Morgan, backed the deal, saying: “During the 50 years since I founded Redrow, I could not be more proud of the unique reputation it has earned for building premium homes and thriving communities.”
“Barratt is a home builder I have long admired due to their like-minded attention to quality. “I am confident that the Barratt/Redrow combination with their three high-quality complementary brands, will create a standout home builder for the future and accelerate the delivery of much-needed homes.”
David Thomas, group chief executive of Barratt, said: “This is an exciting opportunity to bring together two highly complementary companies, creating an exceptional home builder in terms of quality, service and sustainability, able to build more of the high-quality homes this country needs.”
“The combined group would leverage the respective strengths of both Barratt and Redrow, delivering significant benefits to our people, our supply chains, and – most importantly – our customers.”
Matthew Pratt, group chief executive of Redrow, said: “Redrow and Barratt combined creates a leading UK homebuilder. Together, we’ll be in a much better position to offer a broader range of high-quality and energy-efficient homes to customers.”
“The Redrow brand, with its premium, characterful homes, has an excellent reputation and will remain a key part of the Combined Group. As with Barratt, Redrow’s fifty-year success story is based on its people, products and supply chain partners. Both businesses are a great fit and there are many exciting opportunities to innovate and share knowledge across a range of different areas.”
The deal is expected to be completed in Q2 2024 following regulatory and shareholder approval.
