LONDON, UK: The boards of Sovereign Housing Association Limited and Network Homes Limited have agreed to enter into formal negotiations with a view to joining together in a merger.
The decision was agreed by their respective boards on Thursday 9 March. The target date for the completion of the merger is 1 October 2023. The new organisation, Sovereign Network Group, will be one of the largest housing associations in the UK, with over 82,000 homes across the South of England and in London.
Under the proposals, the new organisation will initially take the form of a group structure with Sovereign being the parent (renamed Sovereign Network Group) and Network Homes the subsidiary (renamed Sovereign Network Homes), with a view to full amalgamation happening in April 2025.
Sovereign Network Group will have an annual income of over £830m in 2024-5 and will invest £9.2bn over the next ten years, building 25,000 new homes – almost 4,000 more than current plans, as well as regenerating estates and improving the quality of existing homes. They have also pledged to establish a new Community Foundation to invest £100m in communities over a ten-year period.
The new organisation, Sovereign Network Group, will be one of the largest housing associations in the UK, with over 82,000 homes across the South of England and in London. Subject to a formal appointment process, it is expected that Mark Washer, CEO at Sovereign will become the Chief Executive and Helen Evans, currently CEO of Network Homes, will become Deputy Chief Executive.
Sovereign Chair Paul Massara will become Chair of Sovereign Network Group and interim Chair at Network Homes, Jon Gooding, will become Deputy Chair. The partnership will be subject to registration by the Financial Conduct Authority, which is currently expected to be around September 2023.
The merger comes at a time when housing associations are facing a challenging economic outlook with rising costs affecting their supply chains and their rents capped by government. At the same time, social housing tenants face high energy and food bills and there is chronic shortage of affordable homes.
According to their business plan, 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. The new organisation will be committed to be Net Zero by 2050.