UK housebuilder Keepmoat Group has agreed to sell its large regeneration arm to French energy and services provider Engie in a deal valued at £330m ($405m).
The £1bn ($1.2bn) turnover company based in Doncaster, South Yorkshire, will conclude the deal with Engie in the next few months, and will use the cash build more houses.
The move comes three years after Keepmoat itself was bought by two London-based private equity firms, TDR and Sun Capital.
Keepmoat chief executive Dave Sheridan will transfer to Engie once the deal has completed, together with all 2,500 staff in the regeneration business.
Keepmoat will keep growing strongly– Peter Hindley, Keepmoat chief executive
Engie is an electricity utility and contractor that was formerly known as GDF Suez. It is based in La Défense, Paris, but already employs 17,000 people in the UK, where it provides property services and district heating schemes to local authorities and businesses. The main attraction of the deal for Engie is Keepmoat’s relationship with local authorities.
Wilfrid Petrie, the chief executive of Engie in the UK and Ireland, said in a statement: "With the Keepmoat regeneration business, we are extending and deepening our relationships with local authorities right across the country.
"Today, buildings account for 30% of UK carbon emissions and our investment in Keepmoat’s regeneration business underlines our long-term commitment to the UK as it transitions to a lower carbon economy.
"This transaction will also support our growth ambitions for decentralised energy networks and our home energy business as the regeneration activities will bring us closer to the end customer."
Keepmoat will use the cash raised by the sale of the regeneration business to increase its housing output. The housing arm is about half the size of the business sold, but it has doubled in size since 2014, and has announced a target of completing more than 3,500 homes in 2018.
Peter Hindley, the group chief executive, said in a statement: "We have the investment and sites to build more homes than ever before, and help yet more people secure a place of their own. Keepmoat will keep growing strongly."
Image: Student housing in Ambleside, Cumbria (Keepmoat)