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(Sharecast News) - Housebuilder Vistry has signed a £819.0m deal with Leaf Living and Sage Homes for the delivery of more than 2,900 mixed-tenure new homes.
Vistry said on Tuesday that it has made "significant progress" with its strategy of merging its housebuilding operations into its partnerships business through the signing of "a substantial partnership: agreement with Leaf and Sage.
Leaf and Sage will acquire 2,915 units from the group, with the plots located across 70 of Vistry's developments. Delivery will commence in the current year and the majority of homes will be completed within the next two years.
The London-listed group highlighted that the agreement exemplifies its "high return, capital light partnerships business model" and expects to see an initial cash receipt of roughly £160.0m in FY23, with further staged payments across the development programme.
In addition to releasing "significant capital", Vistry said the secured revenues enable an acceleration of the delivery of units across the 70 sites, with the portfolio expected to deliver an adjusted operating margin in excess of 12% and a return on capital employed of approximately 40%.
"The conclusion of this agreement underpins our previously stated adjusted profit before tax expectation for FY23 of £410.0m and year-end net debt of circa £100.0m, and adds visibility and security to the group's FY24 build programme," said Vistry.
As of 1145 GMT, Vistry shares were up 4.09% at 764.0p.
Reporting by Iain Gilbert at Sharecast.com
