McCarthy & Stone's owners seek buyers at around £1bn

McCarthy & Stone, the UK retirement homes provider owned by a consortium of private equity investors, has begun talks about a potential £1bn-plus takeover, according to reports.

The move comes just as the sector is poised to benefit from Chancellor George Osborne's new measures announced on Friday to stoke the housebuilding market.

Middle East sovereign funds and private equity firms including CVC Capital Partners were among potential buyers approached, Sky News reported.

McCarthy & Stone's owners, a consortium of investors including Alchemy Partners, Goldman Sachs, TPG, Anchorage Capital and Strategic Value Partners, had recently been looking at a 2015 stock market flotation managed by investment bank Rotschild.

The Bournemouth-headquartered company, Britain’s biggest builder of retirement flats, last year reported profits soaring from £12.5m to £63.2m on sales up 25% at £387.8m, with half-year results in March showing profits progress continuing.

A potential takeover or flotation has been suggested at close to the £1.1bn valuation at which it was taken private in 2006 by retail tycoon Sir Tom Hunter and billionaire brothers David and Simon Reuben.

In 2013 the shareholder group injected £367m of new equity in order to pay down debt ahead of the planned listing or sale, with a further £160m refinancing of outstanding debt with a five-year loan.

Recent weeks have seen the housing and property sectors on the front foot, with acceleration this week as Osborne announced changes that will make it easier for building projects to go ahead.

Under the new rules, town halls that take too long to process applications will face fines and central government will have more power to intervene on planning rulings.