Galliford CEO Greg Fitzgerald will join the housebuilder as of 18 April
Companies: Galliford Try Holdings PLC, Vistry Group PLC
FTSE 250 house builder Bovis Homes announced on Wednesday that it has appointed Galliford Chief-Exec Greg Fitzgerald as its new CEO and rejected a merger with the same firm.
In an update to investors, Bovis said Mr Fitzgerald would start on 18 April, with interim CEO Earl Sibley returning to his position as Group Finance Director.
Mr Fitzgerald has spent the past 30 years building a career at Galliford, where he increased the scale of its housebuilding business and improved profitability. At Bovis, his annual salary will be £650k, and he will get an annual bonus of up to 100% of his salary payable in shares.
Non-Exec Chairman Ian Tyler said he was delighted that Mr Fitzgerald was joining as the new CEO:
"He brings a wealth of house building experience and I am confident he will rapidly drive performance across the Bovis business."
Mr Fitzgerald added that Bovis was a "great brand" with excellent people and a high-quality land bank. He said he was looking forward to joining the management team to "restore" Bovis' reputation as a leading housebuilder to deliver improved returns to investors.
Rejection of Galliford proposal
Bovis said it had been in discussions with Galliford to evaluate the merits of a merger proposal, focusing on potential synergies that might result from a combination of the two businesses.
However, those discussions ultimately proved unsuccessful as the Bovis Board believed the merger undervalued the underlying Bovis business.
"Accordingly, the Board has decided to reject the proposal as it believes that an independent strategy under the leadership of Greg Fitzgerald will deliver greater value for shareholders."
Operational Update
Buried in today's busy news flow, Bovis also released an operational update, saying that current sales and reservations were in line with the Board's expectations.
The firm says it is making progress with its 2017 priorities, with operational processes and controls improved across all regions:
"We have significantly enhanced our customer service function across all regions and more than half of all Bovis employees have participated in a bespoke Customer Training Programme, with all employees targeted by the end of April. In addition, we are making good progress with resolving the high level of customer service issues we faced at the start of 2017."
The Group says it is trying to improve performance through cost efficiencies, more effective build processes and improvements in quality.
Shares in Bovis rose 2% on Wednesday to 865p, with Galliford shares up marginally at 1475p.
