Murdoch closes in on Rightmove takeover but property website could expect higher bid

Rupert Murdoch is edging closer to acquiring Rightmove, although a higher bid may be needed to secure the deal.

Australian property firm Rea Group, majority-owned by media mogul News Corp, has submitted a third bid, worth £6.1bn, for the property website.

Rightmove said it would “carefully consider” the proposal after having rejected two previous bids worth £5.6bn and £5.9bn.

The latest offer values ​​the British company’s shares at 770 pence each, about 9 percent higher than the first offer of 705 pence earlier this month.

But analysts said Rea may have to raise its offer again to secure a deal.

Russ Mould, investment director at broker AJ Bell, said: ‘The fact that Rightmove says it will carefully consider the latest proposal implies it is not completely cold-blooded about the prospect of a takeover, knowing it has to act in the best interests of shareholders.

However, it looks like the company will continue to push for more. If Rightmove stands firm and refuses to be bought on the cheap, it would also demonstrate that UK plc is not for sale at any price.

Rea yesterday criticised Rightmove for refusing to come to the negotiating table.

Chief executive Owen Wilson said he was “really disappointed by the lack of commitment” from the target company’s board.

But in a sign that this could change, London-listed Rightmove said it was considering the latest proposal, suggesting it was not entirely opposed to a deal at the right price.

The takeover interest comes as the UK property market begins to recover from a period of lower demand due to high mortgage costs. This is expected to boost Rightmove’s shares and profits.

Rightmove shares rose 0.8 per cent, or 5.2 pence, to 679.6 pence yesterday but remained below the last offer price, suggesting shareholders are not convinced by the new bid.

Mould said: “This looks like a serious transaction, although the bidder’s view of fair value is not yet aligned with shareholder expectations.”

Property website group chairman Andrew Fisher said: ‘Rightmove is an exceptional company with a very clear strategy, a consistent track record of delivery and a strong management team.

“The board of directors is confident in the short- and long-term prospects of the company. The board will continue to act on behalf of our shareholders and will respond to the latest proposal in a timely manner.” Rea has until the end of the month to submit a formal offer or withdraw.

Jefferies analysts said the tone in Rea’s announcements “has changed and become more assertive.”