Midlands property company has secure future after £500m deal
The future of a West Midlands property company is secure after its £0.5bn acquisition by an ambitious housing association.
Warwick-based Gallagher Estates has become a wholly owned subsidiary of London & Quadrant Housing Trust following the £520m deal.
L&Q, which is working to try and solve the housing crisis in London and the south east, said the firm would continue to be run by its current management team as a stand-alone entity.
The acquisition follows L&Q’s merger with East Thames Ltd, the launch of an ambitious plan to deliver 100,000 new homes and a £2.6bn refinancing package which creates the platform for growth.
Gallagher Estates, chaired by Tony Gallagher, controls land capable of providing 42,500 new homes, mainly in the South and South Midlands.
The deal, part advised out of the Midlands, does not include Mr Gallagher’s commercial and retail property development and investment activities.
David Montague, chief executive of L&Q said: “Our acquisition of Gallagher Estates is a defining moment for L&Q and shows commitment to our vision of creating 100,000 new homes in our capacity as lead developer and as an enabler working with key delivery partners.
“Through this deal L&Q will unlock land for development across a wider range of tenures, and speed up the delivery of new homes through our ability to invest over the long term.
“It will also add the significant skills and expertise of one of the UK’s leading strategic land companies, and allow L&Q to take a lead role in housing delivery on a regional basis, whilst generating significant resources for reinvestment into new affordable housing.”
L&Q expects the acquisition to become immediately accretive to L&Q’s earnings.
Mr Gallagher said: “I am delighted to entrust the business that I have developed over many years to L&Q. They have impressed me at every level throughout this transaction. I have no doubt that they will achieve all their new housing objectives and that they will play a big part in resolving the under-supply of housing for UK Limited. I wish them all the luck in the world for the future.”
Mr Gallagher was advised on the sale by Birmingham-based law firm Gateley.
AIM-listed Gateley’s corporate team was led by partner Nick Smith and supported by Zum Mohammed and Michael Byrne.
Mr Smith said: “Tony and his team have built a first-rate business in Gallagher Estates. We were delighted to advise on the sale to L&Q and are confident the business will continue to flourish under their ownership.”
L&Q was advised by Clifford Chance.
