Bellway abandons £720m takeover deal for rival Crest Nicholson

Bellway has walked away from a potential takeover of rival housebuilder Crest Nicholson.

Last month, FTSE 250 firm Bellway put forward a £720 million takeover approach to buy its competitor after two previous proposals were rebuffed.

Crest Nicholson previously said it was “minded” to accept the deal, but Bellway has now said it will not put forward a firm offer after talks between the companies.

Newcastle-based Bellway’s proposal would have seen it buy the share capital of Crest for 273p per share.

On Tuesday, Bellway said “that it does not intend to make a firm offer for Crest Nicholson” but did not explain its reason for dropping its takeover pursuit.

In a statement, Bellway added: “As noted in its trading update released on August 9, Bellway remains confident that its robust balance sheet and operational strength, combined with the depth and quality of its land bank, will enable Bellway to deliver volume growth in the years ahead and support ongoing value creation for shareholders.”

In response, Crest said it “remains confident in its standalone prospects, in particular given conclusion of the review of provisions for completed development sites supported by external consultants, its highly attractive land portfolio and the new leadership of Martyn Clark”.

Crest has also received interest over a potential merger deal from rival housing developer Avant Homes, which is owned by New York hedge fund Elliott.

Avant, which is led by former Persimmon boss Jeff Fairburn, saw its bid to buy Crest rejected last month.

The bid interest is the latest in a line of major mergers in the housebuilding industry, with companies joining forces after a period of high mortgage rates and weaker demand.

Earlier this year, two of Britain’s biggest housebuilders, Barratt Developments and Redrow, agreed to a tie-up worth £2.5 billion which they said would accelerate housebuilding across the country.