Scottish housing giant Cala's storied history takes fresh turn with £1.4 billion sale

The group started out as the City of Aberdeen Land Association in 1875 and was the first Scottish company listed on the London Stock Market. It focuses on the premium end of the market, building homes in Scotland, the south of England and the Cotswolds.

Cala employs more than 1,300 people across ten offices, including its main Scottish base in Edinburgh, and is on track to deliver some 3,000 new homes this year.

Insurance and asset management giant Legal & General (L&G) has agreed to sell Cala back to its former owner in a deal with an enterprise value of £1.35bn. Investment firms Sixth Street Partners and Patron Capital have formed a joint venture to buy the firm, which is among the UK's ten largest housebuilders. Patron Capital formerly part-owned Cala, holding a 46.5 per cent stake in the company alongside L&G. However, it offloaded its stake to L&G in 2018.

The deal will see L&G get £1.16bn, with the rest coming from the buyers acquiring Cala’s net debt. L&G said it could use some of the proceeds to return cash to shareholders via share buybacks.

Kevin Whitaker, chief executive of Cala, said: “This investment by Sixth Street and Patron demonstrates their confidence in Cala’s business plan and further potential. We look forward to developing a strong partnership with Sixth Street and reigniting the excellent relationship we shared with Patron between 2013 and 2018.

“I would like to thank Legal & General for their support since they first invested in Cala. With their backing, Cala has successfully tripled the number of homes we build each year, whilst revenue and profits have grown five- and ten- fold respectively.

“Cala is in a strong position to go forward, with new ownership and a platform to deliver our next stage of growth. We have talented teams in place across the business, and continue to invest in our land pipeline, to grow our delivery of high quality, sustainable new homes throughout the UK.”

Julian Salisbury, co-chief investment officer of Sixth Street, said: “Cala has a bright future and we are proud to be entering this new chapter as stewards of a company with such a deep history and long track record of sustainable growth.”

Keith Breslauer, managing director and founder of Patron Capital, said: “We are pleased to be able to back the Cala business once again. Cala is one of the UK’s leading housebuilders with a best-in-class landbank and a focus on building high-quality homes, being consistently ranked five-star for customer service.

“Furthermore, Cala is also a people business with a strong corporate culture and a business we know well, and we look forward to working closely with Cala’s impressive management team and our partner, Sixth Street, to further build the business and help tackle the undersupply of homes in the UK.”

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