Barratt Puts Wilson Bowden Up For Sale

Housebuilder Barratt is to put its commercial development arm, Wilson Bowden Developments, up for sale with a price tag of more than £250million.Barratt bought Wilson Bowden, which also has a housebuilding arm, for £2.2billion last spring, but a £1.7billion debt burden has piled on pressure for Barratt to raise cash through partial sales.

Barratt chief executive Mark Clare said “Whilst there are crossovers between Wilson Bowden Developments and our core house building business, they are limited...Given the challenges with the current market, we intend to continue to run this business as a standalone segment and deliver shareholder value by exploiting its current portfolio.”

Wilson Bowden's completed developments include office schemes in Leicester, Nottingham and Glasgow, and industrial projects in Birmingham and Loughborough.A trade buyer is seen as the most likely purchaser, although a tougher commercial property market and more expensive debt in the credit squeeze could hinder a sale. Barratt may also consider a partial sale of the business, the reports said.

In the six months to December 2007, Wilson Bowden Developments made operating profits of £4.3 million on sales of £42.5 million, described as a "satisfactory performance against increasingly difficult market conditions".

At the time of February's interim results, the group said it was encouraged by the "existing and potential future value" of the division's portfolio and intended to run the business as a stand-alone operation.

Barratt, which is based in Coalville, Leicestershire, reported underlying pre-tax profits of £201.8 million for the half year ended December 31, up 14.3% on a year earlier.