One of the UK’s biggest house building groups is up for sale

The new chief executive of Legal and General (L&G) is drawing up plans to sell Cala Group – one of Britain’s biggest housebuilders.  

Last week, Sky News reported that L&G, a leading UK financial advisory group, are in contact with bankers at Rothschild to oversee the sale of Cala Group. Experts have claimed that the company will likely be valued at up to £750m.

The news comes just weeks after Antonio Simoes, former HSBC and Santander executive, replaced Sir Nigel Wilson as L&G’s chief executive. The decision has come as a bit of a shock because Cala, which has a headquarters based in Edinburgh, has been owned by L&G for the past six years.

According to Sky News, Simoes described Cala as ‘a very strong business’ during an earnings call which took place last month where he was ‘quizzed about the housebuilder’s future ownership’.

Back in 2013 L&G purchased a major stake of Cala, before taking over the business completely in 2018.

Although the reason for selling the company remains unclear, rumours have surfaced about the organisation struggling to keep up with climbing interest rates – a problem the majority of property companies are currently facing.

However, as the news has recently surfaced that inflation rates are coming down and the Bank of England have hinted that interest rates could be lowered within the next few months, housing organisations across the UK have voiced their optimism about the future.

A spokesperson from L&G said: ‘Legal & General regularly review and conduct conversations about the future of all our various investments and subsidiary businesses as we seek to maximise value for our shareholders.’

Image: Lidia Nikole

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