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Scots builder agrees to takeover

Category: Scotland Business News — Mark on March 30, 2013

Construction firm Cala Group has agreed to a new partnership arrangement, which ultimately is a £200m takeover.

The Edinburgh-based firm will see Patron Capital Partners and Legal & General each take a 46.5% stake in the firm. The deal, which is valued at £210m, will leave Cala with a 7% share in the new company.

The move will come as a surprise to many in the construction industry. Cala also announced a 34% rise in its private home sales for the start of the year. In 2011, the firm also posted its highest profits in nearly 15 years, of £11.4m.

Speaking about the deal, Cala’s chief executive Alan Brown, explained the intention:

“We went out looking for new partners about nine months ago and have today signed up a deal with two excellent partners.

“We had a really good financial year which ended in June 2012 and the equity markets were moving in a positive way so it just made sense for us to go out and see if we could find somebody who would like to invest alongside us.”

Such tie-ups are becoming more and more common-place in Scotland, as is alternative finance such as invoice factoring. With Brown going on to say that with the firm’s debts reduced, and a “normalised” balance sheet now in place, significant growth is possible.

The investment from Patron and Legal & General further allows this, with Brown further explaining that the funds will emphasise the development and buying of new land.

'Disclaimer: The information contained in these articles is of a general nature and no assurance of accuracy can be given. It is not a substitute for specific professional advice in your own circumstances. No action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a consequence of the material can be accepted by the authors or the firm.

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