One of Onyx Construction Consultants major clients announced on 31st March that it had reduced its debt with the sale of its USA & Canada House Building Divisions a wise move we think bearing in mind the current climate in the US and UK.
Taylor Wimpey plc announces the sale of its North American Business for ($955m) £595m.
The Company has agreed to sell Taylor Woodrow Holdings (USA), Inc. and Taylor Wimpey Holdings of Canada, Corporation to TMM Holdings Limited Partnership, a partnership controlled by certain investment funds affiliated with TPG Capital, certain investment funds affiliated with Oaktree Capital Management, L.P., as well as JH Investments Inc., and its subsidiaries for a base consideration of $955m (£595m at the current exchange rate) payable on Completion. The Company will also receive additional proceeds for cash balances in the North American Business as at 31 December 2010 and net capital invested by the Company in the North American Business from 1 January 2011 to Completion.
Highlights of the Disposal:
– The Disposal is a significant step towards achieving the Group’s strategic objective of focusing on its core UK housing business, creating a strong financial base for future investment;
– The base consideration of £595m represents a premium of 3.4% to adjusted net assets as at 31 December 2010); and
– The net cash proceeds of the Disposal will be applied to reduce the Group’s borrowings and its pension deficit, resulting in an overall increase in its financial flexibility.
Following the Disposal, the Group will build on the significant performance improvement in the UK. The Group will continue to focus on delivering margin improvement from the existing land portfolio and adding new sites where good opportunities are identified.
Pete Redfern, Group Chief Executive, said:
“We are delighted to announce the sale of our North American Business, which is a significant step towards our goal of becoming a UK focused homebuilder. The sale will provide us with a strengthened balance sheet and increased financial capacity to invest in the UK and to pursue our strategic aims of focusing on margin growth.
“Following a competitive process, we are pleased to have achieved a price that reflects an attractive valuation for this business. I have been hugely impressed by our North American employees and would like to take this opportunity to thank them for their hard work, loyalty and commitment over many years and in relation to this transaction.“