Galliford Try and Bovis Homes have been forced out into the open today to confirm weekend press reports that they had been in talks. Bovis, led by former Galliford Try boss Greg Fitzgerald, offered Galliford Try shares in the business in exchange for Linden Homes and Galliford’s Partnerships & Regeneration businesses.
The plan would have left Galliford Try as a pure construction contracting business, albeit a loss-making one.
Galliford Try put out a statement this morning saying: “The Galliford Try board carefully considered the Bovis Homes proposal together with its financial adviser, Rothschild & Co. The board rejected the Bovis Homes proposal as it believes it does not fully value the Linden Homes and Partnerships & Regeneration divisions and is not in the interests of all shareholders.”
Bovis Homes also put out a statement. It said: “Bovis Homes confirms that following an initial proposal, some preliminary discussions and the receipt of some high-level financial information from Galliford Try, Bovis Homes submitted a revised proposal (subject to detailed due diligence) on 8th May 2019 regarding the potential combination of Bovis Homes and Galliford Try's Linden Homes and Partnerships & Regeneration businesses for consideration of £950m together with the assumption of Galliford Try's 10-year debt private placement of £100m, with the consideration to be satisfied via the issuance of new Bovis Homes shares directly to Galliford Try shareholders.”
Galliford Try rejected the Bovis Homes proposal on 24th May and the two companies are no longer in discussions.
The slight irony about this story is that it was only two years ago that Galliford Try tried to take over Bovis Homes for £1.2bn. At the time, Bovis was in crisis. It rejected takeover bids from both Galliford Try and Redrow and instead recruited Greg Fitzgerald – chief executive and then executive chairman of Galliford Try from 2005 to 2016 – to be its new chief executive. He has since restored Bovis Homes to a degree of health, while Galliford Try has been weighed down by losses on major construction projects, including the Aberdeen bypass and the Queensferry Crossing.