TIDMBVS
RNS Number : 6249B
Bovis Homes Group PLC
05 April 2017
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF
THAT JURISDICTION.
Bovis Homes Group PLC ("Bovis" or the "Company")
CEO appointment and operational update
Rejection of Galliford Try PLC ("Galliford") merger proposal
The Board of Bovis is pleased to announce the appointment of
Greg Fitzgerald as its new Chief Executive. Greg Fitzgerald is the
former Chief Executive and Chairman of Galliford, where he spent
over 30 years of his career. During his time as Chief Executive, he
oversaw the transformation of Galliford, increasing the scale of
the housebuilding business and improving profitability. Greg
Fitzgerald is a former non-executive Director of the NHBC and is
currently non-executive Chairman at Ardent Hire Solutions and Baker
Estates Limited.
Greg Fitzgerald's appointment as Chief Executive will take place
with effect from 18 April 2017.
Following Greg Fitzgerald's appointment, Earl Sibley will resume
his role as Group Finance Director. The Board would like to thank
Earl for his strong interim leadership.
Operational update
Current sales and reservations are in line with the Board's
expectations and we are making good progress with our priorities
for 2017. Operational processes and controls have been
fundamentally reviewed with improvements and standardisation
implemented across all regions.
We have significantly enhanced our customer service function
across all regions and more than half of all Bovis employees have
participated in a bespoke Customer Training Programme, with all
employees targeted by the end of April. In addition we are making
good progress with resolving the high level of customer service
issues we faced at the start of 2017.
In 2017 the Group is focused on re-setting the business and
driving operational improvements through cost efficiencies, more
effective build processes and improvements in quality.
Following this period of re-setting, we will progress towards
delivering the high level of returns embedded in our quality land
assets.
We aim to replenish our land bank during 2017 and thereafter
maintain an underlying 4 year consented land bank. The Group
continues to secure attractive land opportunities and has had early
success in 2017 with the conversion of strategic sites at Bishop's
Stortford, Didcot and West Witney totalling 834 plots.
We are progressing our programme of balance sheet optimisation
over the next two years from the sale of our shared equity assets,
a reduction in part exchange assets, the continuation of land sales
where appropriate and a strategic partnership at our site in
Wellingborough. This balance sheet optimisation programme is
expected to accelerate the Group's delivery of an improved return
on capital employed.
The Board intends to return to shareholders any excess capital
which results from this programme and from improved cash generation
from operations.
Overall, good progress has been made with our review of our
strategy and structure which we announced in February. Following
his appointment, Greg Fitzgerald will assume leadership of this
review with a view to developing further our plans to deliver value
to shareholders.
Rejection of Galliford proposal
Bovis notes the announcement by Galliford this morning
withdrawing its merger proposal.
In recent weeks, the Company has held discussions with Galliford
to assess the merits of Galliford's merger proposal, focusing on
the potential synergies that might result from a combination of the
businesses. Following these discussions, Galliford re-affirmed the
terms of its merger proposal and the level of synergies expected to
arise from the combination.
The Board has reviewed the merger proposal and concluded that it
failed to reflect the underlying value of the Bovis business.
Accordingly, the Board has decided to reject the proposal as it
believes that an independent strategy under the leadership of Greg
Fitzgerald will deliver greater value for shareholders.
The rejection has been communicated to Galliford.
This announcement has been made without the consent of
Galliford.
Greg Fitzgerald remuneration terms
The following summarises the principal terms of the remuneration
package agreed between Bovis and Greg Fitzgerald:
- Annual Salary of GBP650,000
- Annual Bonus of up to 100% of salary payable in shares and
deferred for 3 years. For 2017 only, the Annual Bonus will be based
on his leadership of the review of strategy and structure.
- LTIP award of up to 200% of salary for each of the first two
years and 150% of salary thereafter. Performance will be measured
over a 3 year period using measures in line with our Remuneration
Policy. Awards will also be subject to a 2 year holding period.
- An award of shares of up to 100% of salary to recompense Greg
Fitzgerald for relinquishing management of certain investments in
order to take up this role. This award will vest at the end of
December 2018 provided the Bovis Total Shareholder Return is at
least in line with the median performance of sector peers over the
period.
Further details of the remuneration package will be sent to
shareholders in due course. It is expected that a vote to approve
relevant terms will take place at a general meeting of shareholders
(EGM) to be convened on the same day as the forthcoming AGM of the
Company.
Ian Tyler, non-executive Chairman, said: "We are delighted that
Greg has agreed to be our new Chief Executive. He brings a wealth
of housebuilding experience and I am confident he will rapidly
drive performance across the Bovis business."
Greg Fitzgerald, incoming Chief Executive, said: "Bovis has a
great brand, excellent people and a high quality land bank. I very
much look forward to working with the management team to restore
Bovis' position as a leading housebuilder and deliver significantly
improved returns to shareholders."
Enquiries
Bovis
Ian Tyler
Earl Sibley +44 (0) 14 7487 6219
Moelis & Company (financial
adviser to Bovis)
Mark Aedy
Liam Beere +44 (0) 20 7634 3500
Maitland
Neil Bennett
James McFarlane +44 (0) 20 7379 5151
Jefferies (joint corporate broker to Bovis)
Antonia Rowan +44 (0) 20 7029 8317
Paul Nicholls +44 (0) 20 7029 8211
Numis (joint corporate
broker to Bovis)
Heraclis Economides +44 (0) 20 7260 1224
Richard Thomas +44 (0) 20 7260 1322
Important notices
This announcement contains inside information.
There is no further information which requires disclosure under
9.6.13R of the Listing Rules of the UK Listing Authority.
A copy of this announcement (subject to any restrictions
relating to persons resident in restricted jurisdictions) will be
available at
www.Bovishomesgroup.co.uk/investor-centre/rns-announcements
promptly and in any event by no later than 12.00 noon on 6 April
2017. The content of the website referred to in this announcement
is not incorporated into and does not form part of this
announcement.
Moelis & Company UK LLP ("Moelis & Company"), which is
authorised and regulated by the Financial Conduct Authority in the
UK, is acting exclusively as financial adviser to Bovis and no one
else in connection with the matters described in this announcement
and will not be responsible to anyone other than Bovis for
providing the protections afforded to clients of Moelis &
Company nor for providing advice in connection with the matters
referred to herein. Neither Moelis & Company nor any of its
subsidiaries, branches or affiliates owes or accepts any duty,
liability or responsibility whatsoever (whether direct or indirect,
whether in contract, in tort, under statute or otherwise) to any
person who is not a client of Moelis & Company in connection
with this announcement, any statement contained herein or
otherwise.
Jefferies International Limited ("Jefferies"), which is
authorised and regulated by the Financial Conduct Authority in the
UK, is acting exclusively as corporate broker to Bovis and no one
else in connection with the matters described in this announcement
and will not be responsible to anyone other than Bovis for
providing the protections afforded to clients of Jefferies nor for
providing advice in connection with the matters referred to herein.
Neither Jefferies nor any of its subsidiaries, branches or
affiliates owes or accepts any duty, liability or responsibility
whatsoever (whether direct or indirect, whether in contract, in
tort, under statute or otherwise) to any person who is not a client
of Jefferies in connection with this announcement, any statement
contained herein or otherwise.
Numis Securities Limited ("Numis"), which is authorised and
regulated by the Financial Conduct Authority in the UK, is acting
exclusively as corporate broker to Bovis and no one else in
connection with the matters described in this announcement and will
not be responsible to anyone other than Bovis for providing the
protections afforded to clients of Numis nor for providing advice
in connection with the matters referred to herein. Neither Numis
nor any of its subsidiaries, branches or affiliates owes or accepts
any duty, liability or responsibility whatsoever (whether direct or
indirect, whether in contract, in tort, under statute or otherwise)
to any person who is not a client of Numis in connection with this
announcement, any statement contained herein or otherwise.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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