Jeff Ubben is the founder of Inclusive Capital Partners, a San Francisco hedge fund that made a hostile takeover bid for Countryside Partnerships last year. That resulted in Countryside running into the arms of Vistry. Vistry took over Countryside for £1.25bn last November.
Ubben, however, who had a 9% stake in Countryside, never went away. Inclusive Capital Partners (In-Cap) is Vistry’s second largest shareholder, representing a 5.9% stake worth around £150m. Tomorrow, 23rd March 2023, he becomes a non-executive director of Vistry Group.
Vistry chairman Ralph Findlay said: “I am very pleased to welcome Jeff to the board. His deep expertise and insights, particularly in impact and sustainability, will be of significant value as we continue to integrate our recent acquisition of Countryside Partnerships at pace.”
Jeffrey Ubben said: “The combination of a distinct model addressing the acute shortage of affordable homes in the UK alongside leading private housebuilding brands gives Vistry the scale, operating synergies, and resources to deliver societal benefits and great long term returns to shareholders. To work closely with CEO Greg Fitzgerald, whose experience and track record in this industry is exemplary, and also with the board in executing on Vistry’s compelling mixed-tenure approach to housing, is an opportunity to highlight how profitable growth can be linked to positive community impact.”
Ubben’s seat on the board carries particular conditions, however, to prevent him stirring up trouble. He has promised not to circulate statements to shareholders, not to requisition (or propose resolutions at) general shareholder meetings, not to try to get other directors thrown out, and to always use his shareholding to vote in agreement with any recommendations given by a majority of the board.
The arrival of Ubben in Vistry’s boardroom comes as the company posts result for 2022 showing 13% revenue growth to £2,729m but a 22% fall in pre-tax profit to £247.5m.
The profit figure was after exceptional expenses of £153.9m (2021: £12.2m) including £97.0m fire safety provision and £56.9m costs related to the Countryside acquisition at year-end.
Adjusted to exclude these one-off costs, pre-tax profit was up 21% at £418.4m.
Vistry said that it was making progress with its post Grenfell remediation works. Of the 304 buildings identified as requiring remediation, work has been completed on 59. It is on site on another 30 and “engaged in the remediation process on 188” with 27 buildings to yet start.
As at 31st December 2022, the group fire safety provision was £309.2m. This includes a provision of £191.8m acquired through the combination with Countryside, a charge of £97.0m in the year covering additional requirements under the pledge and the developer remediation contract, and net spend of £4.8m on remediation work in the year.
Chief executive Greg Fitzgerald said of the acquisition: “The businesses have come together extremely well with a good cultural fit, and the integration process is making excellent progress. As a result, we are confident of delivering annualised synergy benefits of £60m, ahead of our original target.”
He added: “We are focused on maximising the opportunities from our unique market position and increasing the supply of high quality housing across all tenures. The resilience of our Partnerships business is reflected in its strong forward order book which gives us the confidence that the business will deliver growth in 2023 revenues in line with its strategy. Housebuilding is focused on operational excellence to maximise its sales opportunity and has the expertise, embedded controls and disciplines in place to succeed. Market conditions are improving and based on the assumption that private sales rates continue to trend towards levels seen in 2019, we expect group adjusted profit before tax for 2023 to be in excess of £440m.”