Partner Article

Newcastle’s Grainger sells stake in Sovereign Reversions Portfolio for £18.5m

Newcastle-based Grainger plc, the UK’s largest listed residential property owner and manager, has agreed terms to sell its interest in the New Sovereign Reversions Limited (Sovereign) portfolio, a business which owns and manages portfolios of UK equity release plans, for £18.5m.

Grainger said it has agreed to sell its 50% stake in the portfolio, a joint venture with Moorfield Real Estate Fund II, to an affiliate of private equity group Lone Star Funds.

Grainger will receive a total cash consideration of c.£18.5m subject to completion adjustments for its interest in the portfolio, representing an anticipated pre-tax profit of c.£4.5m and post-tax profit of c.£3.6m.

As at 31 March 2015, the Sovereign portfolio comprised 767 properties primarily subject to home reversion plans, located throughout the UK.

The transaction is expected to complete by 29 May 2015 and FCA approvals for change of control have already been received.

Andrew Cunningham, chief executive of Grainger, said: “We are pleased to announce today’s sale which was a compelling opportunity to realise an attractive return on our investment and support our JV partner’s wider strategic activity.”

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