"This is an exciting opportunity to bring together two highly complementary companies, creating an exceptional homebuilder in terms of quality, service and sustainability, able to build more of the high-quality homes this country needs"
- David Thomas - Barratt Redrow
The creation of Barratt Redrow will see Barratt CEO David Thomas become group CEO of the new firm, while Redrow CEO Matthew Pratt will join the new combined board as CEO of Redrow and group executive director.
The deal has been welcomed by Redrow founder Steve Morgan who said that it would "create a stand-out housebuilder.”
The deal is at a 27% premium to Redrow’s share price with each Redrow shareholder receiving 1.4 Barratt shares. Following the deal, Redrow shareholders will hold approximately 32.8% of the combined group and Barratt shareholders 67.2%. Barratt says the deal is expected to achieve cost synergies of at least £90 million.
The recent Housing Market Intelligence Report shows that the combined housebuilder, looking at recent years, could build more than 22,000 homes a year on a turnover of £7.4 billion.
Barratt CEO David Thomas said: “We have great respect for Redrow, its overall strategy, its leadership and employees, and its high-quality homes and communities.
"This is an exciting opportunity to bring together two highly complementary companies, creating an exceptional homebuilder in terms of quality, service and sustainability, able to build more of the high-quality homes this country needs.
"The combined group would leverage the respective strengths of both Barratt and Redrow, delivering significant benefits to our people, our supply chains, and - most importantly - our customers."
Matthew Pratt said: "Redrow and Barratt combined create a leading UK homebuilder. Together, we'll be in a much better position to offer a broader range of high-quality and energy-efficient homes to customers. The Redrow brand, with its premium, characterful homes, has an excellent reputation and will remain a key part of the Combined Group.
"As with Barratt, Redrow's fifty-year success story is based on its people, products and supply chain partners. Both businesses are a great fit and there are many exciting opportunities to innovate and share knowledge across a range of different areas."
Steve Morgan added: "During the 50 years since I founded Redrow, I could not be more proud of the unique reputation it has earned for building premium homes and thriving communities.
"Barratt is a home builder I have long admired due to their like-minded attention to quality. I am confident that the Barratt/Redrow combination with their three high-quality complementary brands, will create a standout home builder for the future and accelerate the delivery of much-needed homes across the UK."
