REA has put forward a new, third bid to acquire Rightmove, intensifying its takeover efforts amidst previous rejections.
- The latest offer includes both cash and shares, valuing Rightmove at £6.1 billion with a 9.2% premium on prior proposals.
- REA’s CEO Owen Wilson has articulated a strong case for the strategic merger, highlighting mutual benefits in technology and market reach.
- Rightmove’s board has acknowledged the new bid but remains committed to its standing strategy, having rejected earlier proposals.
- Rightmove’s financial performance remains robust, recording a 7% increase in revenue and steady profit growth in recent reports.
REA, an Australian property company majority-owned by Rupert Murdoch’s News Corp, has escalated its acquisition ambitions for the UK-based Rightmove by submitting a third bid. This effort follows two previously rejected offers by Rightmove’s shareholders. The latest proposal offers 341 pence in cash per share, supplemented by 0.0422 new REA shares, culminating in a total value of 770 pence per Rightmove share. This valuation puts Rightmove at approximately £6.1 billion, a 9.2% increase over earlier bids.
Owen Wilson, the Chief Executive of REA, expressed optimism about the merger, citing the potential synergy between the companies. He commented that combining REA’s technological prowess with Rightmove’s established market presence could enhance the overall experience for property agents, buyers, and sellers. Wilson also called for engagement from Rightmove’s board, highlighting the intensifying competition within the digital property sector as a compelling reason for the merger.
Despite the attractive offer, Rightmove’s board has maintained its previous stance, choosing to deliberate the proposal ‘in due course.’ The board, led by Chair Andrew Fisher, described Rightmove as having a ‘clear strategy’ and ‘consistent track record,’ asserting confidence in its prospects independent of REA’s proposals. The board labelled the initial offers as ‘highly opportunistic and unattractive,’ leading to their unanimous rejection.
Meanwhile, Rightmove’s recent half-year financial performance has shown resilience, reporting a 7% increase in revenue to £192 million and a slight rise in pre-tax profits to £133 million. These figures underscore the company’s solid financial footing, which may be a factor in the board’s cautious approach to REA’s advances.
The strategic interplay between REA’s ambitions and Rightmove’s steadfast strategy continues to unfold, with both parties considering their positions amidst an evolving property market landscape.
