Bovis shares are risen more than 10% in afternoon trading after it received two potential takeover offers. From www.bbc.co.uk
The housebuilder said it had turned down the separate approaches from Redrow and Galliford Try, but that talks with the latter continue. Redrow offered a cash-and-shares deal and Galliford Try’s offer was in shares only. Kent-based Bovis rejected the offers from both companies, arguing that they undervalued its business.
Galliford Try – the UK’s sixth-biggest housebuilder – said its offer was worth 7% more than Bovis’ closing price of 828p on Friday.
Bovis shares were trading at 915p on Monday, valuing the company at just over £1.2bn. It has been a torrid 2017 fpr Bovis. Last month, it said it was setting aside £7m to compensate customers who were sold houses that were unfinished and had electrical and plumbing faults.
Pre-tax profits for last year fell 3% to £154.7m despite a buoyant housing market. Bovis also lacks a chief executive after David Ritchie stepped down in January after eight years in the role, weeks after issuing a profit warning.
Neil Wilson, of ETX Capital, said Bovis had made itself a target: “The share price has failed to recover from the Brexit shock last June and is still down a quarter from 2015 highs.”
Bovis said the Redrow proposal was not in the interests of Bovis shareholders: “Redrow subsequently indicated that it was not willing to improve the terms of its proposal and discussions were terminated. Discussions with Galliford Try are ongoing.”
Redrow’s offer is valued at 814p a Bovis share, while Galliford Try’s is worth 886p per share.
Under Takeover Panel rules, Galliford has one month to submit a full takeover offer or walk away.