Barratt Developments has confirmed that it will take over Wilson Bowden in a deal valuing the housebuilder at £2.2 billion.

Barratt, which fought off rival bids from Tom Hunter, Scotland's richest man, and George Wimpey, will pay £22.45 per share in a cash and paper offer for Wilson Bowden.

The final offer represents a 23 per cent premium on Wilson Bowden’s share price at November 24, 2006, the last day of business before the company announced that it was in preliminary talks regarding a sale.

The acquisition will make Barratt the UK's largest housebuilder with a market value of £4.3 billion, overtaking the current leader, Persimmon.

Wilson Bowden first indicated its interest in being taken over last July when Rothschild, the investment bank, was called in to review a stake held by David Wilson, the company's chairman and a member of the Wilson family, which owns a third of the business.

Barratt is expected to strip out £45 million worth of operating and purchasing synergies in the second financial year following the completion of the takeover.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive