Allison Homes aims to grow four-fold after re-financing

Lincolnshire-based housebuilder Allison Homes Group, previously known as Larkfleet, has secured a £120m re-financing designed to fund a planned four-fold expansion.

The £126m turnover firm, which along with Allison Homes was bought out by funds managed by US investment giant Pimco last year for an undisclosed price, said the re-financing will allow Allison Group to grow to deliver 2,000 homes a year.

Allison Group built just 444 homes in the 15 months to September 2021 according to its most recent accounts, posted in July, meaning delivery of over 2,000 homes a year would require growing to more than four times its current size.

The re-financing consists of a £20m five year term loan from HSBC plus a £100m five year revolving credit facility with HSBC and NatWest.

John Anderson, CEO of the Allison Group (pictured, left) said the refinancing would bring “exciting possibilities” for Allison Group.

He said: “We are making significant progress and have excellent ideas in store for our future that will now be viable with the £120 million we’ve secured from HSBC and NatWest.

“We are continuing to seek new talent, improving payment terms for suppliers, and making great headway towards our goal of building 2,000 homes a year. Our growth strategy is being brought to life and we are excited about what the future holds for us.”

Allison Group said the re-financing would enable it to improve its payment terms to suppliers from 45 to 30 days, in recognition it will not be able to achieve its growth target without bringing suppliers on board. Larkfleet changed its name to Allison Homes Group in March this year.

The firm reported a pre-tax profit of just £0.76m last year, and fell to a loss after tax, after its earnings were impacted by £7.1m of interest payments on loans. According to documents filed at Companies House, the subsequent purchase by Pimco fund Empyrean Acquisitions Ltd allowed the housebuilder to pay off in full a £35m loan from Cheyne Capital, as well as injecting an additional £8m of capital investment in the firm.