The offer of 115p per share represents a 39% premium to the 83p closing share price yesterday, although shares rebounded to 117p this morning suggesting hopes of a counter bid.
Before the pandemic the retirement homes builder’s shares were trading around the 156p mark.
McCarthy & Stone was rocked by the Covid-19 outbreak suffering a £91m pre-tax loss in the first half of the year with revenue plunging to just £101m.
Prior to the pandemic, McCarthy & Stone reported 14-month revenue in 2019 at £725m, with profit down a quarter to £43m.
During this period it delivered 2,300 completions.
Donald Quintin, president of 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.
“Lone Star shares the McCarthy & Stone management team’s vision for growth.
“With our proven experience in developing property-related businesses, we believe our partnership will enable McCarthy & Stone to accelerate its transformation, which aligns with the Government’s goal of increasing the supply of attractive housing options in the UK.
“We look forward to partnering with McCarthy & Stone’s management and employees to further support the company’s ongoing transformation.”
McCarthy & Stone chairman Paul Lester said: “The offer represents a compelling and attractive opportunity for shareholders to crystallise their investment in the company in the near term.
“It 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.”