7:25 am – Barratt secures Redrow in a £2.5 billion deal

Following Barratt’s disclosure of half-year results, which indicated a 33.5% decline in revenue from £2.78 billion to £1.86 billion, they have finalised a deal to create the UK’s largest housebuilder. Based on historical performance, the new entity is set to generate £7.45 billion in turnover and deliver more than 22,600 homes annually.

Barratt anticipates achieving annual pre-tax cost synergies of at least £90 million within the third year post-completion, with approximately 90% expected to be realised by the end of the second year.

8:15 am – FTSE 100 sees a slight increase

Reflecting the market’s response to Barratt’s acquisition of Redrow, London’s FTSE 100 index, which includes Barratt Developments, rose by 12.38 points, or 0.2%, reaching 7,693.39. Similarly, the FTSE 250, which lists Redrow, increased by 0.2% to 19,210.18. Despite the positive market response, Barratt Developments experienced a 2.6% decline, while Redrow saw a 17% surge. Other builders, including Crest Nicholson, responded positively, recording a 7.3% increase.

8:41 am – Barratt’s acquisition termed a “seismic shift” for the sector

Interactive investor’s Head of Markets, Richard Hunter, described Barratt’s takeover of FTSE 250 rival Redrow as a “seismic shift” for the sector. This move addresses recent challenges housebuilders face within the economic landscape and consolidates the strengths of two significant players, forming the new “Barratt Redrow” company with aggregate revenues of £7.45 billion.

The combined land pipeline of 92,345 plots provides significant strength for the new entity when economic constraints ease, and a combined net cash position of £874 million allows room for further expansion when opportunities arise.

9:15 am – Halifax reports a fourth consecutive monthly rise in house prices

UK house prices have increased for the fourth consecutive month in January, rising by 1.3%. The lender reported that average house prices are 2.5% higher than a year ago, marking the highest annual growth since January 2023. According to Halifax, the typical UK home now costs £291,029, an increase of over £3,900 from the previous month.