TopHat has now taken £300m from shareholders in the past 18 months – which is 25 times its turnover.
New shareholders of TopHat include traditional house-builder Persimmon and institutional investor Aviva, each of whom has made what is described as a “substantial” investment in the company.
Persimmon, which is investing £25m, said that it aims to use TopHat’s manufacturing to complement its existing Space4 timber frame product to expanding its product offering to customers.
Principal shareholder Goldman Sachs Asset Management also subscribed to TopHat’s latest fundraising round. It previously led a £130m fund-raising in October 2021 and £100m in December 2022.
TopHat was founded in 2016 and opened a 125,000 sq ft factory in Dove Valley Park, Foston in 2018 with capacity to produce 800 homes a year.
It has since also leased 650,000 sq ft premises for a factory in Corby that is expected to increase production capacity to more than 4,500 units per year. However, production in Coby will not start until next year. The company has previously said that it will not be in a postion to start making a profit until after that factory is up and running at volume. [See previous report here.]
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Latest accounts for TopHat show that its turnover increased from £6.3m in the year to 31st October 2020 to £12.4m in fiscal 2021. Pre-tax losses in the same period reduced from £21.3m to £18.0m.
Jordan Rosenhaus, chief executive and founder of TopHat, said: “Today’s announcement is testament to the innovative approach that TopHat continues to take to house building and marks a step-change for the future of housing. It has been clear for some time that designing and building green, beautiful homes in factories is a critical part of solving the housing crisis – and today’s announcement will enable TopHat to reach the scale where the new generation of modular homes can be made available to everyone.”
Persimmon chief executive Dean Finch said: “Persimmon is delighted to announce this partnership, combining the country’s most innovative modular manufacturer with the most cost-effective volume house builder.
“This investment provides Persimmon with guaranteed access to very energy-efficient volumetric modular units as well as TopHat’s innovative brick façade to use with our Space4 timber frame products. This will provide further build efficiencies, manage the growing challenge of labour shortages in key trades and expand our product range for customers. Combining our complementary industry-leading capabilities alongside other significant new investment makes me excited for the opportunities ahead.”
Aviva Capital Partners chief executive John Cummins said: “Aviva is using its financial strength to invest in the sustainable infrastructure and real estate which are central to the UK’s net zero transition. TopHat is a pioneer of low-carbon homes and this investment will make sustainable housing more widely available, making a difference to communities and providing a retirement income for our customers.”
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