Sovereign and Network plan merger to create 82,000-home association giant

Sovereign and Network have announced a plan to merge to create an 82,000-home housing association giant.

The boards of the two organisations have agreed the move, which they believe will enable them to build 25,000 homes over 10 years.

This would be 4,000 more than they had been planning to build as separate organisations, according to the two organisations.

Under the plan Network would initially join Sovereign as a subsidiary on 1 October. They would then look to a full amalgamation, in which Network would no longer exist as a separate entity, in April 2025.

The group, which would be one of the largest housing associations in the UK, will be called Sovereign Network Group.

Mark Washer, current chief executive of Sovereign (pictured), is expected to become boss of the enlarged provider, which will be one of the largest housing associations in the UK and known as Sovereign Network Group.

Helen Evans, current chief executive of Network Homes, will become deputy chief executive. Paul Massara, chair of Sovereign, will become chair of Sovereign Network, while current interim chiar at Network Jon Gooding will become deputy chair.

In 2021/22 the two organisations had a combined turnover of £666m (see box). The organisations forecast their joint annual income to increase to £830m in 2024/25.

Sovereign has traditionally operated mainly in Oxfordshire, Berkshire and Hampshire but Washer told Housing Today last year it is targeting geographical expansion. The group has also bought two shopping centre sites, in Bristol and Farnborough, as part of a town centre regeneration strategy.

Network is based in Wembley, west London and is a member of the G15 group of housing associations in London. 

Sovereign and Network also intend to establish a foundation to invest £100m in communities over a 10-year period.

The merger plan comes as the housing association sector is facing a squeeze on finances due to the need to invest in existing stock following pandemic delays and regulatory pressure, along with decarbonisation and building safety costs. Housing associations are also facing a 7% rent cap and have, along with the rest of the economy, been battling cost inflation.

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A spokesperson said: “Together Sovereign and Network Homes will be well-placed to weather the economic storms and to continue to invest in building safety, technology to improve customer experience and decarbonisation.”

Washer said: “This is a really exciting opportunity for both Sovereign and Network Homes. Together we can build more homes and invest more in the homes we own. As we merge, we will learn from one other, bringing the best from each organisation.”

Evans said :”Together our size and resilience as an organisation will increase our ability to invest and to build new, affordable homes.