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Springfield Properties PLC - housebuilder in Scotland - Signs deal to buy Scottish housebuilding business of Mactaggart & Mickel Group Ltd for £46.3 million. This comprises £10.5 million to be paid in cash on completion, and a deferred cash consideration of £35.8m to be paid proportionally as homes are sold over the next five years. For the financial year ended May 31, the group expects to report results in line with market expectations, with good revenue growth and a better-than-expected reduction in net debt to about £39.0 million annually. The acquisition will be funded from the company's internal resources and existing debt facilities with Bank of Scotland.
Springfield Properties Chief Executive Officer Innes Smith says: ‘We are very pleased to welcome Mactaggart & Mickel's Scottish housebuilding business into the Springfield Group. As well as bringing another premium brand into the group, this acquisition gives us land, with planning permission, in areas of significant demand. The structure of the acquisition - with the majority of the payment to be made as homes are completed - de-risks the deal and creates an effective and efficient means of acquiring land.’
Under the deal, Springfield has bought six live private and affordable sites with work in progress with a value of around £15 million and fixed assets. In addition, the company has also acquired a brand licence to build homes as Mactaggart & Mickel on a further 11 private and affordable sites. In total, the 187 sites will have a gross development value of about £230 million. Springfield intends to retain all of Mactaggart & Mickel's housebuilding business employees.
Mactaggart & Mickel, founded in 1925, is a family-owned company operating in the UK construction industry, targeting the three- to five-bedroom private home market in locations within the Central Belt of Scotland.
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