Proposed Acquisition of Stillorgan Site
Cairn Homes plc
Related Party Transaction: Proposed Acquisition of Stillorgan Site
Dublin / London, 10 September 2020: Cairn Homes plc ("Cairn", the "Company" or the "Group"), the leading Irish homebuilding company, today announces that it has entered into a conditional agreement to acquire the former Esmonde Motors Garage premises and adjoining land located at Stillorgan Road and the Hill, Stillorgan, Co. Dublin (the "Stillorgan Site") from The Emerald Fund ICAV for an overall cash consideration amount of €14,000,000 (excluding VAT) (the "Transaction"). The consideration will be payable in two tranches (i) 50% at completion and (ii) 50% shall be payable on 1 July 2021 or such earlier date that the Group determines in its sole discretion. The Transaction is conditional upon shareholder approval as set out in further detail below.
The Stillorgan Site
The Stillorgan Site comprises 1.35 acres of derelict brownfield. It is a strategic fit with the Group's existing landbank and in particular Cairn's adjoining development site in Stillorgan, the Blakes Site, which was acquired by the Group as part of the Project Clear loan portfolio acquisition from Ulster Bank in 2016. Given the complementary location, the Board believes that the Transaction presents an opportunity to generate further value for shareholders by combining the two sites which are underpinned by strong development fundamentals in an established and sought-after South Dublin residential suburb in close proximity to Dublin City Centre. The enlarged site will provide construction related economies of scale and enable the Company to deliver cost synergies by spreading fixed development costs across both sites which is expected to be accretive to margins and will increase expected returns for shareholders over and above the development of the Blakes Site alone. As such, the Group anticipates that the Transaction will be value accretive for shareholders.
Related Party Transaction
The seller is The Emerald Fund ICAV (acting on behalf of the Emerald Opportunity Investment Fund) ("Emerald"). Alan McIntosh, a co-founder, non-executive Director and shareholder of Cairn, and his spouse are the beneficiaries of a discretionary trust that is the ultimate owner of Emerald and as such Alan McIntosh is considered a related party under the Listing Rules. This Transaction is deemed to be a smaller "related party transaction" within the meaning of Listing Rule 11.1.15, and the Company's sponsor, Goodbody Stockbrokers UC, has provided written confirmation to the Board of the Company that it considers the terms of the Transaction to be fair and reasonable as far as the shareholders of the Company are concerned.
Extraordinary General Meeting
Furthermore, Section 238 of the Companies Act 2014 requires that the Transaction be conditional upon approval by shareholders at an Extraordinary General Meeting ("EGM"). The Company will shortly be issuing a circular to shareholders which will set out further details of the proposed terms of the Transaction and explain why the Board (other than Alan McIntosh, who as a related party has recused himself from any such considerations) believes the Transaction to be in the best interests of the Company's shareholders as a whole and will recommend that shareholders vote in favour of the resolution to be proposed to approve the Transaction at the EGM on 12 October 2020.
-ENDS-
For further information, contact:
Cairn Homes plc +353 1 696 4600
Michael Stanley, Co-Founder and Chief Executive Officer
Shane Doherty, Chief Financial Officer
Declan Murray, Head of Investor Relations
Tara Grimley, Company Secretary
Drury Communications +353 1 260 5000
Billy Murphy
Louise Walsh
Finsbury +44 207 251 3801
Gordon Simpson
Charles O'Brien
Notes to Editors
Cairn Homes plc ("Cairn") is the leading Irish homebuilder committed to building high quality, competitively priced, sustainable new homes in great locations. At Cairn, the homeowner is at the very centre of the design process and we strive to provide an unparalleled customer service throughout each stage of the home-buying journey. A new Cairn home is thoughtfully designed and built to last with a focus on creating shared spaces and environments where communities prosper. Cairn owns a c. 17,000 unit land bank across 35 residential development sites, over 90% of which are located in the Greater Dublin Area ("GDA") with excellent public transport and infrastructure links. Cairn is today building on 15 sites in the GDA, which will deliver over 6,750 new homes.
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