Gresham House buy-out wins regulatory backing

A £470m private equity buy-out of the firm behind ‘for-profit’ landlord ReSI looks set to go ahead after the deal received approval from financial regulators.

The proposed purchase by a company set up by Searchlight Capital Partners of Gresham House plc, the fund manager behind ReSI, was approved by both boards on July 17, before receiving the backing of shareholders in August.

Gresham House said today that on 6 October 2023, the requisite approval was received from the Financial Conduct Authority (FCA). The FCA approval was the last significant hurdle for the deal to get over, with just the receipt of CBI approval for change in control of Gresham House Asset Management Ireland Limited, and the receipt of approval from US state insurance regulators remaining.

Private equity firm Searchlight, which is headquartered in New York, has said it is willing to provide “the capital necessary to accelerate Gresham House’s strategic plan”.

The acquisition is expected to go through in late 2023 or early 2024, with Gresham House saying today that its buyer “values the current structure, strategy and management of Gresham House and recognises that the management team and employees will be key to Gresham House’s success going forward.”

It said Searchlight intended to “support the existing management team” post-acquisition, and that it intended to “accelerate Gresham House’s strategy, including by providing capital and support to identify and execute successful acquisitions in the UK and internationally.”

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Searchlight said in June that the acquisition, arranged through a vehicle called Seed Bidco Ltd, which is comprised of funds advised by Searchlight, will allow it to take advantage of Gresham House’s position as “one of the UK’s leading asset managers in sustainable alternative asset classes, which show strong investor interest and allocation.”

Gresham’s listed ‘for profit’ housing association business, Residential Secure Income plc, owns a portfolio of 3,298 homes worth £355m. As well as the ReSI group of companies, Gresham House also owns a range of other investments in social and environmental infrastructure, including energy storage, forestry and renewable energy.