Galliford Try plc (LON:GFRD) has rejected an approach from Bovis Homes Group PLC (LON:BVS) to buy the company’s homebuilding businesses.
Bovis Homes had wanted to purchase Galliford’s Linden Homes and Partnerships & Regeneration divisions in exchange for new shares.
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The deal would have left Galliford as an independently-listed company focused on construction.
Galliford said in a statement on Tuesday that it had rejected the proposal as it believes it “does not fully value the Linden Homes and Partnerships & Regeneration divisions and is not in the interests of all shareholders”.
The announcement comes two years after full merger talks between the two companies collapsed. Galliford tried to buy Bovis but was rejected after the two firms failed to reach an agreement on valuation.
In the past 12 months, Galliford's shares have fallen by more than 40% as its construction arm has struggled.
Last week, the group said the profit hit from restructuring its construction division will be at the top end of its expected range.
Shares in Galliford jumped 5.9% to 570p in morning trading while Bovis Homes shares were little changed at 991.5p.
In a note to clients, analysts at UBS coomented: "Although exact terms were not disclosed, we estimate the deal would have implied Bovis shareholders holding 58% of the combined entity and Galliford Try owning 42%, assuming Bovis' last share price of 995p.".
"The news is a reversal of Galliford Try's unsolicited merger proposal in 2017 when Galliford shareholders would have owned 52.25% of the combined entity and Bovis shareholders 47.75%.