Legal & General has agreed to a £605m takeover of the luxury housebuilder Cala, of which it already owned a minority stake.
The investment arm of the financial services giant, L&G Capital, has agreed to pay around £315m to acquire the remaining 52 per cent of Cala.
This values the company at upwards of £600m. L&G acquired Cala in 2013, with private equity group Patron Capital Partners. It is now buying out Patron’s stake in the business.
L&G said the housebuilder has “performed strongly” under the joint ownership, growing revenues threefold from £241m in 2013 of £748 in 2017.
In its financial results for the 12 months to June 2017 Cala boosted its pre-tax profits by 14 per cent, to £68.5m.
L&G adds that the company had “attractive growth prospects” given the current push to build more homes in the UK.
L&G Capital chief executive Kerrigan Proctor says: “Legal & General is delighted to assume full ownership of Cala Homes. [The company] has a strong management team with proven experience of managing a house building business across business cycles.”
Cala Homes chief executive Alan Brown welcomed this additional investment from L&G. He adds: “Over the past five years we have become one of the UK’s fastest growing house builders.”
Cast chief executive Mark Farmer says: “This takeover is encouraging for the entire industry.
“An injection of large scale fresh capital combined with L&G’s much broader strategic ambitions to tackle the UK housing crisis on a number of fronts can only be a good thing.”