Crest Nicholson Confirms Rescue Deal

Crest Nicholson has confirmed the details of a financial restructuring that will reduce its liabilities to lenders by £630 million. The process will also put in place a new £40 million working capital facility and restructures the terms of its remaining debt through to the end of March 2012.

The restructuring will be achieved through a Scheme of Arrangement which involves the creation of a new holding company, Crest Nicholson Holdings Ltd (CNHL), to acquire Castle Bidco Ltd, the vehicle used by HBOS and West Coast Capital to take Crest Nicholson private in May 2007. CNHL will be 90% owned by the lending banks and 10% by management.

None of the Group's trading companies will be subject to such a process but, with a three year financing agreement in place, will derive benefit from a significantly reduced Group debt burden and a new working capital facility. In a changed market, this realignment with current economic conditions will place Crest Nicholson in a stronger trading position.

Commenting on the deal, Stephen Stone, Chief Executive of Crest Nicholson, said:

“The Scheme of Arrangement is now underway and I can confirm that the discussions with our stakeholders have resulted in their overwhelming support for the financial restructuring of the Group.

“I am confident that the process, which requires Court approval, will be complete by the end of March. This will ensure that the business is better placed to deal with the current sector slowdown and will enable us to make the most of future opportunities in a difficult market.”

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