Legal & General’s divestment of Cala Group marks a significant shift in the property development landscape. The sale involves key players and a substantial financial transaction.
- Legal & General has agreed to sell house-builder Cala Group to private investors Sixth Street Partners and Patron Capital.
- The deal, valued at £1.35 billion, is expected to close by the end of 2024.
- Cala Group, a historic builder in the UK, will continue its growth under new ownership, promising 3,000 new homes this year.
- Key stakeholders express optimism, indicating confidence in Cala’s potential and its management team’s abilities.
Legal & General has agreed to divest its entire holding in Cala Group, a notable UK house-builder, to investment entities Sixth Street Partners and Patron Capital. This move marks a significant transition within the UK’s property development sector. The transaction, valued at £1.35 billion, is anticipated to conclude in the fourth quarter of 2024. Founded in 1875 as the City of Aberdeen Land Association, Cala Group has been under Legal & General’s sole ownership since 2018, although Patron Capital also held an investment stake prior to that time. The company remains on track to deliver approximately 3,000 homes across key regions such as Scotland, the south of England, and the Cotswolds in the current year.
Cala Group’s Chief Executive, Kevin Whitaker, has publicly stated that the investment from Sixth Street and Patron Capital underscores the investors’ confidence in Cala’s business strategy and potential for growth. Whitaker also expressed enthusiasm for rekindling a robust partnership with Patron Capital, a previous investor from 2013 to 2018. He credited Legal & General’s support over the years for substantial growth in the company’s home-building capacity, as well as increased revenue and profits.
Keith Breslauer, Managing Director and founder of Patron Capital, affirmed the firm’s longstanding commitment to Cala, praising it as one of the UK’s leading housebuilders. Breslauer highlighted Cala’s exceptional landbank and commitment to high-quality construction, alongside their five-star customer service rating and strong corporate culture. He expressed a forward-looking anticipation of working again with Cala’s management team and new partners.
Julian Salisbury, Co-Chief Investment Officer of Sixth Street, remarked on Cala’s promising future under the new stewardship. He articulated pride in becoming part of Cala’s enduring legacy and its proven track record of sustainable growth. His comments aligned with a broader confidence in the newly formed alliance between Sixth Street, Patron Capital, and Cala Group.
Legal & General’s CEO, António Simões, explained that this transaction aligns with the company’s strategic goals of honing focus on core businesses and delivering enhanced shareholder value. Cala’s ten-fold profit increase since 2013 reflects the success of this long-standing relationship. Simões extended gratitude towards Cala’s team for their pivotal role in this journey and conveyed optimism for their future.
The transfer of Cala Group to renowned investors heralds a promising new chapter for all parties involved.
