(Corrects fundraising details in paragraphs 2 and 14)
By Brenda Goh
LONDON, Jan 21 (Reuters) - British housebuilder CrestNicholson announced a return to pre-tax profit andthe UK stock market on Monday, positioning itself for a sectorrecovery five years after being taken over during the country'shousing crash.
The 50-year-old company posted annual pre-tax profit of 62.1million pounds, compared to a 27 million-pound loss in 2011, andsaid it would issue new shares on the London stock exchange toraise about 50 million pounds ($79 million) and pay down debt.
"Our announcement today is just a sign that the housingmarket recovery is starting to move forward. There's a lot ofinterest in the sector and a lot of interest from government inincreasing housing volumes in this country," Chief ExecutiveStephen Stone told Reuters.
The company said it expected a minimum of 35 percent of itsshares to be free float following the offer.
Crest Nicholson, one of Britain's biggest housebuilders, washit hard by the slump in the UK housing market after years ofeasy credit inflated prices.
It and rivals like Taylor Wimpey and BarrattDevelopments have since focused their building effortsin the south of England and London, where house prices stayedstrong in comparison to the north of the country. Taylor Wimpeyand Barrett said last week that they expect to post significantprofit rises for the full year.
The sector has also been helped by government schemes toboost buyer demand and loosen mortgage lending. The RoyalInstitution of Chartered Surveyors showed British house pricesheld steady in December and are tipped to pick up in comingmonths.
Crest said on Monday revenue for the full year rose 27.9percent to 408 million pounds.
The company has a short term land bank of which over 95percent is in the south of England, with 16,959 plots on 72sites and an estimated gross development value of 3.9 billionpounds.
Crest hopes to use cash raised from the listing to buy moreland.
IPO
A source told Reuters in September that Crest was activelyexploring a flotation on the London stock market and described a500 million pound valuation at the lower end of the possiblerange.
"Being a listed company does give you greater flexibilityand credibility," Stone said on Thursday.
Crest was taken private by Scottish entrepreneur Tom Hunterand mortgage lender HBOS in May 2007 and is now majority ownedby U.S. distressed investment fund Varde Partners, after aseries of deals last year.
The company said its offer to list would also incorporate asale of existing shares by some institutional shareholders,including Varde Partners and Deutsche Bank AG worthabout 150 million pounds.
Stone said he hoped institutional investors such as Fidelityand Standard Life, which were shareholders in CrestNicholson before it was taken private, would participate in theinitial public offering.
"All of our major institutions when we were listed did verywell - we sold out just a few months before Northern Rock(collapsed)," he said. "We hope that the major institutions thatwere involved then might be interested in once again becomingpart of our company."
The company expects the offer to complete in February and tobecome eligible for inclusion in the FTSE UK indices at thequarterly review at either March 2013 or June 2013. ($1 = 0.6304 British pounds) (editing by Sophie Walker)
Persimmon (PSN)
Taylor Wimpey (TW.)