Cala Group sold for £1.35bn

Legal & General has sold house builder Cala Group to investment firm Sixth Street Partners and former owner Patron Capital for £1.35bn.

Kevin Whitaker, CEO of Cala said: “Today’s announcement is excellent news for Cala. This investment by Sixth Street and Patron demonstrates their confidence in Cala’s business plan and further potential.

“We look forward to developing a strong partnership with Sixth Street and reigniting the excellent relationship we shared with Patron between 2013 and 2018.

“I would like to thank Legal & General for their support since they first invested in Cala. With their backing, Cala has successfully tripled the number of homes we build each year, whilst revenue and profits have grown five- and ten- fold respectively.

“Cala’s biggest strength is the talent and passion of our people, and I would like to thank our dedicated employees for continuing to deliver for the business and our customers.

“Cala is in a strong position to go forward, with new ownership and a platform to deliver our next stage of growth. We have talented teams in place across the business, and continue to invest in our land pipeline, to grow our delivery of high quality, sustainable new homes throughout the UK.”

Cala builds new homes across the South of England, the Cotswolds and Scotland and is on track to deliver 3,000 new homes this year.

In the year ending December 31 2023 Cala Group sold 2,917 homes, resulting in a turnover of £1.3bn and profit before tax (before exceptional items and revaluations) of £112m.

The firm employs over 1,300 people across 10 offices and has around 75 live developments at any time.

Julian Salisbury, Co-Chief Investment Officer of Sixth Street, said:  “Cala has a bright future and we are proud to be entering this new chapter as stewards of a company with such a deep history and long track record of sustainable growth.

“We, together with Patron, look forward to continuing to support Cala and its management team, not only with capital but also with the significant resources of our London-based real estate investment team led by Giulio Passanisi.”

Keith Breslauer, Managing Director and founder of Patron Capital, said: “We are pleased to be able to back the Cala business once again. Cala is one of the UK’s leading housebuilders with a best-in-class landbank and a focus on building high-quality homes, being consistently ranked five-star for customer service.

“Furthermore, Cala is also a people business with a strong corporate culture and a business we know well, and we look forward to working closely with Cala’s impressive management team and our partner, Sixth Street, to further build the business and help tackle the undersupply of homes in the UK.”

António Simões, Group Chief Executive Officer of Legal & General added:  “This transaction demonstrates continued momentum in executing our strategy, simplifying our portfolio to enable a sharper focus on our core, synergistic businesses.

“Cala has been an important part of L&G for over a decade, with profits increasing ten-fold since our initial investment in 2013.”

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Written by Grant Prior at Construction Enquirer