A construction company owned by investment firm Elliott Advisors has submitted a secret takeover bid for its London-listed rival Crest Nicholson.
Sky News has learned that Avant Homes, run by former Persimmon boss Jeff Fairburn, made an all-share proposal to the Crest board last month.
The offer, which city sources said was rejected by the Crest board within the last 10 days, would have seen Elliott become the largest shareholder in the combined group, according to sources.
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One said the combination risks representing an unattractive prospect for some Crest Nicholson shareholders.
Avant’s interest comes weeks after Crest rejected an offer from Bellway, another London-listed housebuilder, which would have valued the target at around £665 million.
Bellway now has a deadline set by the Takeover Panel to make a formal offer for Crest next Thursday.
It is unclear whether it intends to submit a revised offer.
“Crest Nicholson’s board evaluated the revised proposal with its financial advisors and concluded that it significantly undervalued Crest Nicholson and its independent future prospects and did not serve the best interests of Crest Nicholson shareholders,” it said last month.
“The council therefore unanimously rejected the revised proposal on May 14, 2024.”
A potential bidding war by one of Britain’s biggest housebuilders would boost an industry that will be at the heart of the new labor government political agenda back in the city’s spotlight.
Work committed in his manifesto to building 1.5 million homes during his first five-year term.
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Construction stocks responded positively to Labor’s landslide victory on Friday morning, with gains for Persimmon, Barratt Developments and Taylor Wimpey.
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Persimmon is already contemplating a bid for Cala Group, which is owned by Legal & General, while Barratt and Redrow agreed a £2.5bn merger earlier this year.
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On Friday morning, Crest Nicholson shares were up around 1.4% to 248p, giving the company a market capitalization of £628m.
Avant is chaired by Fairburn, who left Persimmon in 2018 amid city protests over his vast pay package.
Elliott engineered a deal to buy Avant through Berkeley DeVeer.
HSBC and Bank of America are advising Avant on its interest in Crest, which is being advised by Barclays and Jefferies.
Elliott and Crest declined to comment.
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