Unveiling a 拢73m management buyout package, Davies said he feared for the future of any small company on the stock exchange.
Linden, which went public in 1996, is the second housebuilder to leave the stock market this year.
Kent-based Ward Holdings went private in June in a 拢24.2m deal.
Fairview also announced its intention to delist this summer and Furlong Homes agreed a 拢23.2m bid with private property developer Gladedale in June.
Davies said: 鈥淭here is very little the stock market can offer a housebuilder. I have heard it said that this will happen to all small companies unless they are dot-coms.
鈥淚 think it鈥檚 difficult to see at the moment how the stock exchange will deal with smaller companies in the old industries. The combination doesn鈥檛 seem to be particularly liked.鈥�
Analysts were sympathetic to Linden鈥檚 plight. Seymour Pierce analyst Leslie Kent said: 鈥淗ousebuilders are getting very disillusioned. They are delivering a tremendous rate of growth but the City still sees them as an old cyclical sector.鈥�
The MBO, which is led by Davies and backed by the Bank of Scotland, will be through newly incorporated firm Nednil. The team also includes Linden chairman Andrew Sells, directors Colin Muller and Gerard Price. The offer values Linden shares at 290p.
Davies said 1 million of the 7.5 million shares in the Surrey-based private firm would be made available to other subsidiary directors.
Davies plans to treble Linden鈥檚 size over the next five years. He said: 鈥淔or all solid businesses, there is plenty of finance available in the private arena.鈥�
Linden will initially focus its growth organically, Davies said, particularly growing its north London and Bristol operations.
Davies said: 鈥淚 don鈥檛 think we will look at acquisitions in the short term. We want to see this bedded down then see what can be done.鈥�
The deal was announced at Linden鈥檚 interim results. The firm saw pre-tax profit rise 50% to 拢6.6m in the six months to 30 June. Turnover increased 45% to 拢62.5m.
Linden said 90% of homes sold in the first half of 2000 were built on recycled land. The group sold 360 homes and apartments at an average selling price of 拢172 550, up from 拢152 000 last year.
Sells said the first half of the year had been busy and all five regional businesses had achieved a strong forward sales position.
