Construction giant Kier has sold its housing division to private equity baron Guy Hands in a cash deal worth £110 mln (€127 mln).
Kier has accepted a bid from Foster BidCo, a newly formed company owned by the billionaire investor, who is the founder, chairman and chief investment officer of private equity firm Terra Firma.
The offer is expected to be approved by shareholders at a meeting in May and to be completed in early June.
Once the sale is completed, Kier Living is to rebrand as Tilia Homes.
A statement to the stock market from Kier said the sale of the housing arm would allow the group to ‘reduce its net debt’ and ‘reduce the volatility of the group’s working capital’. The disposal is also aimed at ‘simplifying the group and allowing it to focus on its core, high-quality, market-leading businesses in infrastructure services, construction, and property’, according to Kier.
Andrew Davies, Kier Group chief executive, said: ‘The actions we have taken over the last two years have created a strong operational platform for sustainable profitable growth and free cash flow. The disposal of Kier Living delivers another key milestone in the group’s strategy to simplify the business and strengthen its balance sheet.’
Kier Living is a housebuilding business with established operations across four of the most affordable regions in England. Kier Living's principal focus is providing well-priced, low-rise, mixed-tenure suburban family homes through open-market sales.
