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A senior executive in Rupert Murdoch’s business empire yesterday criticized Rightmove for hindering a multi-million-dollar takeover process.
Australian property company Rea Group, which is backed by Murdoch’s News Corp, admitted defeat in its month-long attempt to take over the FTSE 100 property website, after a fourth consecutive bid worth £6.2bn was rejected.
In an extraordinary intervention, News Corp chief executive Robert Thomson (pictured left with Murdoch) said Rightmove “didn’t make the right move” and applauded Rea’s withdrawal, saying it would have been “reckless to pay further”.
News Corp chief executive Robert Thomson (left) said Rightmove “didn’t make the right decision”.
Rea has also seen a series of previous bids (which valued Rightmove at £5.6bn, £5.9bn and £6.1bn) rejected.
With the takeover panel’s deadline approaching, Rea’s bosses flew to Britain to try to woo the British firm with an improved proposal.
But recent talks over the weekend between Rightmove chairman Andrew Fisher and Hamish McLennan, his Rea counterpart, failed to make progress.
That gave Australians until 5pm yesterday to “put up or shut up” under procurement rules.
Rightmove rejected a request for an extension of the deadline. Rea then threw in the towel and confirmed that he had no intention of making an offer.
Thomson, a former Australian editor at The Times, said: ‘We strongly support the Rea team’s decision to withdraw from the potential Rightmove acquisition.
We applaud Rea’s financial discipline, as it is unwise to overpay for an asset, even if it clearly had upside potential. ‘
As for Rightmove, we wish them the best in an increasingly competitive UK market; Unfortunately, the company’s board of directors did not make the right decision.’
The comments appear to underline the importance of the attempted takeover by News Corp, which owns 61 percent of Australia-based Rea and is best known for owning The Times and The Sun newspapers.
New York-based News Corp also owns The Wall Street Journal in the United States, a number of Australian titles and publisher Harper Collins.
In addition, Murdoch separately controls the American television network Fox News.
Rea issued a statement about his aborted takeover proposal, accusing Rightmove of a “lack of meaningful commitment”.
Chief executive Owen Wilson said: “We strongly believed in the opportunity to create a globally diversified leader in the digital real estate sector that would benefit both Rea and Rightmove shareholders.”
‘We were disappointed by Rightmove’s limited commitment which prevented our ability to make a firm offer within the available timeframe.
“They had nothing to lose by working with us.”
Rightmove shares fell 7.7 per cent, or 51.2p, to 617.4p.
Rea’s latest cash and shares proposal valued the company’s shares at 775 pence each. He said that represented a 45 per cent premium to Rightmove’s average share price over the previous year.
But it was below the peak just above 800p seen in December 2021. Rightmove said the latest bid undervalued the company.
Analysts had said Rea would have to make a bid valuing the company at at least £7bn to have any chance of success.
Fisher said: ‘We respect Rea and the success they have achieved in their domestic market. “However, we remain confident in Rightmove’s independent future.”
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said Rea Group “runs property websites and indices in Australia, Asia and North America, so gaining a dominant position in the UK would have been very attractive.”
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