US-based Lone Star has launched a cash bid of £630million to buy retirement housebuilder McCarthy & Stone.

The offer values McCarthy & Stone at £1.15 per share, 39 per cent higher than its current trading price but well below its pre-covid trading price of £1.58.

It is reported that the business acquisition represents an attractive opportunity for Lone Star to gain exposure to the retirement living sector.

McCarthy & Stone directors are expected to unanimously recommend that shareholders vote in favour of the scheme.

In a statement, chairman of McCarthy & Stone Paul Lester said: "The McCarthy & Stone Directors believe that the offer from Lone Star represents fair value for shareholders and unanimously intends to recommend the offer.

"The all-cash offer represents a compelling and attractive opportunity for shareholders to realise and crystallise their investment in McCarthy & Stone in the near term and also provides a meaningful premium to the prevailing share price notwithstanding the backdrop of the wider risks posed by the political and macro-economic environment.

"We believe that Lone Star would provide a complementary partner for McCarthy & Stone's stakeholders and along with the investment in the business that Lone Star can provide, will enable further improvements of its transformation strategy and allow McCarthy & Stone to capitalise on its growing rental and multi-tenure offering which would underpin the long-term growth of McCarthy & Stone."

Donald Quintin, president, Lone Star Europe, said: "As a leading developer and manager of retirement communities in the UK, McCarthy & Stone represents an attractive opportunity in a market underpinned by clear fundamentals: a rapidly ageing population and a structural undersupply of suitable housing options for older people."