Tulloch Homes back in Scottish hands after management buyout
A team led by chief executive George Fraser and chairman Tom Allison have acquired a controlling interest in the Inverness-based housebuilders of 40 per cent from US finance giants Goldman Sachs and TPG.
The value of the deal was not disclosed however, Bank of Scotland has provided £30 million funding to support the management team’s plans to grow the business.
Mr Allison, who used to run Clydeport, said: “This is a very significant chapter in the history of one of the most important companies in the Highlands and a deal which we’re confident will secure the future of the business for many years to come.
“Tulloch’s 90 years of construction expertise and its reputation for developing high quality homes at reasonable prices means the company is very well placed to capitalise on the undoubted opportunities available in the years ahead.”
Tulloch said the deal reflects the management team’s confidence in the prospects for the housebuilding sector.
The deal will also mean the housebuilding group’s interests in the three stands at the Caledonian Stadium in Inverness will be transferred to a trust set up for the benefit of the community.
Mr Grant also revealed that, over the next few weeks, Tulloch is expected to announce turnover of more than £58m and more than 280 home completions for the year to June 30, 2014.
He said: “We expect to build a further 300 homes in 2015 via a strong pipeline of developments in our core Highlands market, as well as two new developments in Aberdeenshire in the city centre and Bridge of Don.”
Mr Allison added: “I have to give particular credit to Bank of Scotland for the very positive and professional way they have responded to our requirements.
“They clearly recognise the importance to the Highland economy of having a strong, sizeable housebuilder like Tulloch and have been prepared to back us in every possible way.”
Simon Sweeney, strategic finance director for Bank of Scotland, said: “Tulloch is a leading housebuilder in the Highlands and the firm’s locally-based management team marks the ongoing commitment to its core market while the recent purchase of new sites in Aberdeen gives the business great potential to increase its presence in the wider housebuilding market in Scotland.
“The housebuilding industry makes a significant contribution to Scotland’s economy and Bank of Scotland is committed to investing in the sector, whether that be lending to builders like Tulloch or helping home buyers as a major mortgage provider.”
Tulloch first became part-owned by HBOS when then-chairman David Sutherland sold a 40 per cent stake to the bank for £27.5m.
The deal was done just months before HBOS was taken over by Lloyds Banking Group as the financial crisis started taking its toll in the UK.
Lloyds later restructured the debt it owned in Tulloch twice, in 2009 and 2012, causing the housebuilder to post losses of £65m for the 18-month period to June 30, 2012.
The bank then sold the debt, as part of a £1.2 billion package of distressed property loans, to Goldman Sachs and TPG in 2013.
Tulloch returned to the black with a £964,000 pre-tax profit in 2013.
The new deal marks the return of Lloyds as lender to the group, through its subsidiary Bank of Scotland.