Bargate Homes

DEALS: Bargate Homes

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THE DEAL

  • Sector: Real Estate
  • Deal type: Capital Raising, Debt Advisory
  • Deal size: £25m
  • Year: 2014
  • Lead partner: Ian Milne

DEAL TEAM

Ian Milne

Spectrum leads growth capital investment in Bargate Homes

Spectrum Corporate Finance has successfully led the raising of £25m of growth capital for Bargate Homes, a bespoke property developer, in a deal involving private equity investment by specialist family office, Prowting Investments plc, and revolving credit debt facilities provided by The Royal Bank of Scotland. Prowting Investments will take a minority stake after being introduced to the business by Spectrum who were retained by Bargate to raise equity and flexible debt capital to fund exciting new growth opportunities in the resurgent house building sector.

Based in Fair Oak near Winchester and founded in 2006, Bargate is a leading Southern regional house builder with a strong brand name and a focus on bespoke property development, innovative design and superior specification. Bargate builds houses on developments ranging from 15 to 50 properties in towns and cities across Hampshire and surrounding counties. Despite challenging market conditions in recent years Bargate has established a strong and enviable platform for growth with a forward land bank of more than 1,000 plots under the stewardship of a highly experienced management team.

Bargate approached Spectrum in early 2014 to help the company secure growth capital funding and access to revolving and flexible debt facilities in order to unlock the potential in its significant land bank, and to finance the development of over 1,000 new homes at various sites dotted across the South over the next 5 years. This represented an exciting opportunity against the backdrop of a recovering UK economy, a favourable planning environment, and a clear government agenda to build more new homes. Based on their detailed knowledge of both the private equity and debt markets and working closely with the Bargate management team, Spectrum conducted a focused marketing programme and competitive fund raising process receiving strong interest from a number of parties.

“We interviewed a number of corporate advisors mainly attached to accountancy firms. With no stand-out firm from that group I then approached a contact at a private equity house for his thoughts and he suggested Spectrum. Ian Milne and the Spectrum team made a compelling pitch which picked up on our central issue – that this was a two part role. Finding both the right equity and debt partners is essential in house building as we buy multiple sites and need constant communication to move matters forward in a timely fashion. We were fortunate to attract a number of offers and Ian worked closely with management to make our selection and then drive the deal to a close. I will miss our early morning and late night calls – Ian may not! In short, we were delighted with the choice we made and definitely had the best team by our side.” Gerard Price, Chairman, Bargate Homes