Regulator launches formal probe into Barratt-Redrow tie-up

14th Jun 2024 10:15

(Sharecast News) - The competition watchdog has launched an official investigation into the proposed £2.5bn takeover of house builder Redrow by Barratt Developments, it was confirmed on Friday.

The Competition and Markets Authority first started gathering information on the all-stock deal in March, a month after the tie-up was agreed, but on Friday it confirmed it was moving to a phase 1 investigation.

The CMA said it wanted to assess what impact the takeover could have on competition in the UK.

It also invited interested third parties to comment, with a deadline of 28 June.

The CMA will then have until 8 August to decide whether to proceed with a more in-depth phase 2 probe.

Both companies were informed on Thursday.

The takeover of its smaller rival will secure Barratt's position as the UK's largest housebuilder. The combined business - Barratt Redrow - expects to build around 22,000 homes a year with turnover of more than £7bn.

It is part of a wave of consolidation seen recently across the UK housebuilding sector. In 2022, Vistry snapped up Countryside for £1.25bn, while on Thursday Bellway confirmed that its proposed all-share bid for Crest Nicholson had been rejected.