Irish homebuilder Cairn Homes plc, chaired by former KBC boss John Reynolds, has listed on the London Stock Exchange. The Company has raised €385m of net proceeds from the IPO, after deducting the underwriting costs and other fees and expenses of €15m. Shares were sold to investors at £1 per share.
The company tapped institutions and clients of Goodbody Stockbrokers. Separately, directors pledged an investment in the plc of €29m in equity and cash by the founders of Cairn Homes.
Cairn Homes is an Irish homebuilder with a focus on Dublin, the Dublin commuter belt, Galway, and Cork. Its portfolio Includes five sites with a total estimated gross development value of €360m.
Cairn Homes chairman John Reynolds
First sales expected in June 2015 at the 50-acre Parkside site in North Dublin while construction is progressing at a Killiney site in South Dublin. The company says that construction is due to commence at a Navan site in Q4 2015 and in Galway by mid-2016
In Association with
Cairn Homes is chaired by John Reynolds, a banker who was CEO of KBC Bank Ireland plc from 2009 to 2013. In addition to Reynolds, the board includes outside directors Gary Britton, Andrew Bernhardt, Aidan O’Hogan and and Giles Davies.
The management team comprises Michael Stanley, Alan McIntosh, Eamonn O’Kennedy, Liam O’Brien, Kevin Stanley and Brian Carey.
According to CEO Michael Stanley: “Cairn Homes’ IPO will give our company the platform for a new and sustainable approach to home building in Ireland. We are a well-capitalised business, governed by a strong independent board, with an experienced management team committed to constructing the highest quality houses and apartments for our customers.”
Davy Stockbrokers analyst Colin Sheridan commented: “It will take Cairn some years to build up its land-bank and site profile to produce an efficient capital structure. However, the company is well positioned to become one of the leading builders in the Irish housing market.
“Cairn offers investors the opportunity to gain exposure to the recovering Irish housing market, which is currently underpinned by a strong economic backdrop. After 5-6 years of very little activity in the land market, 2014 saw €674m of land transactions in Ireland, up from just under €200m in 2013. This is still some way below the c.€4bn in deals in 2006 in value terms, and is also 55% lower on a volume basis.
“We also see the land market suffering from a similar supply/demand imbalance as the housing market (i.e. shortage of supply), and with a the profile of land-buyers in the Irish market highly fragmented, land acquisition margins are likely to be inferior to in the UK.”
For full background on Cairn Homes, click here.
