Pizza Express tycoon Hugh Osmond targets housebuilder Crest Nicholson

Hugh Osmond, the businessman who built the Pizza Express chain, has approached Crest Nicholson, the housebuilder that fell into its lenders' hands during last year's property market slump, about a possible takeover bid. The serial entrepreneur, who also started pubs group Punch Taverns, has been in talks for his Horizon Acquisition group to buy Crest Nicholson for as much as £400m. Osmond helped set up Horizon with its chairman, Michael Fairey, former deputy chief executive of Lloyds Bank. They floated the group on the London Stock Exchange in February , pledging to acquire and restructure "a single major business or company", significantly reducing its debt. The listing raised more than £417m to launch Horizon on its quest for a consumer-facing business paralysed by debt, or a so-called "zombie company". It emerged over the weekend that Horizon put the takeover plan to a meeting of Crest's 40 banks on Wednesday. Crest Nicholson is smaller than the kind of business Horizon could target – something with an enterprise value of £1bn or more – but could be seen as an attractive target nonetheless. Freed from its debt burden and ties to its banks, the company would be better placed to buy new land and make more of Britain's housing shortage. At the moment it is focused on housebuilding in the south of England and the Midlands. The housebuilder was seized by its lenders in a debt-for-equity swap of the kind that befell a number of businesses during the downturn, including Jessops, a camera chain, and McCarthy & Stone, a retirement home specialist. For Osmond, expanding Crest Nicholson would be the latest in a long line of business ventures. The Conservative party donor made his name and fortune as a backer of Pizza Express, alongside Luke Johnson, a former Oxford university friend and fellow medic. He went on to found Punch Group in 1997 and remained as executive chairman until 2001. Horizon is his first new project since he retreated from Pearl, the insurance group that bought rival, Resolution, for more than £5bn in 2007. Describing its potential target at the time of its launch, Horizon told investors the business was likely to have "significant operations in the UK", to have an enterprise value of between £1bn and £3bn and to be "constrained by its capital or ownership structure." Crest Nicholson was part of a calamitous push into housebuilding by HBOS, the bank rescued by Lloyds in September 2008. Lloyds led a group of Crest's lenders that wrote off £630m of debt in return for a 90% stake in the company. The housebuilder still has debts of more than £600m. Asked about discussions with Horizon, Crest Nicholson said it was constantly considering its "long-term future". "Despite the challenging economic conditions of the last two years, Crest Nicholson has emerged in a position of strength," Stephen Stone, its chief executive, said in a statement. "Reviewing the long-term future ... of the company remains a perpetual process," he added. The housebuilder is believed to be just one of a number of businesses being sized up by Osmond's group.