SPRINGFIELD Properties has paid £20.1 million to acquire Glasgow-based Dawn Homes in its first takeover since floating on the stock market last year. The deal has triggered a multi-million-pound windfall for Dawn majority shareholder Alan Macdonald, who has now exited the business he founded in 1984.

Elgin-based Springfield, which floated with a market value of nearly £90m, said the Dawn acquisition would boost its presence in west central Scotland and Ayrshire. Shares in the builder leapt more than eight per cent as investors responded to the deal.

Dawn sold 87 houses in the year ended January 31 at an average price of around £220,000, compared with £210,000 achieved by Springfield for private homes. The acquired company, which made an operating profit of £2.3m on turnover of £22.4m, is currently building on six sites, including Queens Quay in Clydebank and Collegelands in Glasgow.

Springfield will pay an initial £17.6m for Dawn, £15.5m in cash and £2.1m from the issue of new ordinary shares. It will pay a further £2.5m in cash on condition it receives planning permission for Dawn’s site at Johnstone near Glasgow.

Separately, the company has conditionally raised £15m through a placing of 12,500,000 new ordinary shares with new and existing investors.

Springfield has taken on net debt of around £6.7m as part of the Dawn deal.

Mr Macdonald held the biggest stake in Dawn, holding 1,697 of the 2,500 shares in its ultimate parent company, DHomes 2014 Holdings Limited.

It suggests that Mr Macdonald has netted around £13.6m from the the Springfield deal.

Springfield executive chairman Sandy Adam, whose grandfather founded the company in 1956, described Dawn as a “good cultural fit” for the business, highlighting its presence in Glasgow as a key factor behind the deal.

“Like ourselves, it has a good reputation,” he said. “When I look round their sites they’re all tidy and efficiently run. Their houses are sharp, look good and well laid-out inside. They make a very good job of building their houses. That’s what attracted us to approach them.”

While Mr Macdonald will leave Dawn to focus on his commercial development business, as well as his ownership of Ayr Racecourse, all 49 of the Dawn team will be moving over to Springfield. That includes its managing director Martin Egan, who will remain in charge of Dawn under the Springfield group.

Mr Adam said it will be “business as usual” for Dawn, whose brand name and head office will be retained. The acquisition swells Springfield’s headcount to nearly 570.

“What we intend to do is keep Dawn Homes as it is,” Mr Adam said. “They are a well-run business producing a good house at the moment.”

Asked whether Springfield would consider making further acquisitions, Mr Adam said it would take its time to bed Dawn into its operation. However, he said the company would continue to look for further opportunities, noting that its listing on the stock market means “we have access to a different type of finance now, which we are using to our advantage.” That could mean a move into England. “You don’t rule anything in [and] don’t rule anything out,” he said.

Mr Macdonald said: “Since establishing Dawn Homes in 1984, we have built up a strong, market-leading and forward-thinking housebuilding business, which made us an attractive proposition for acquisition.

"We were approached by Springfield Properties and were impressed by the vision the team had for the business. Springfield share our goals and values and the acquisition will enable both businesses to accelerate growth on a national scale.”

Shares in Springfield closed up 10p at 134p.

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