The combined Cala and Banner business will directly employ over 600 people and have a turnover of more than £500m in its first full year with net assets of £200m.
Cala was itself taken over last year when venture capital firm Patron Capital Partners and insurance company Legal & General bought it from Lloyds Bank in a £210m deal.
In a trading update last month, Cala announced plans to double the size of its business organically by 2017. The acquisition of Banner Homes will now enable the company to accelerate those growth plans, it said.
Founded in 1975 in Beaconsfield, Banner Homes operates from 21 sites across three regional operational centres in the northern Home Counties, the southern Home Counties and the Midlands. It was privately owned - 75% by the Prowting family and 25% by its management.
Banner sold 235 homes during the 12 months to May 2013 at a private average selling price of £511,000, resulting in revenues of £111m and operating profit of £16.4m at a gross margin of 24%. Its land bank has almost 1,100 units.
Cala’s own land bank consists of 10,770 plots with a gross development value of £3.6bn, including 6,200 consented and 2,700 allocated plots.
The deal was facilitated with additional equity from Patron Capital, Legal & General and Electra and an increased debt facility through new banking arrangements led by Bank of Scotland with Santander. Additional investment from Banner senior directors is also included, bringing the total management investment in Cala to £14m.
“We are delighted to have acquired such a high quality business which fits perfectly with Cala’s own market position and expansion plans,” said chief executive Alan Brown. “Banner has a deserved reputation as one of the finest luxury house builders in the UK and combining the two businesses will put us in the top 10 of UK home builders with significant growth potential.
“Both businesses build high quality homes, place a strong emphasis on customer service and have very similar cultures and I am tremendously excited about bringing together the best of both CALA and Banner in order to drive the enlarged group forward.”
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