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- Property listings site says unsolicited offers ‘still unattractive’
Rightmove has rejected a £6.1bn takeover bid from REA Group following a sharp fall in the latter company’s share value.
The FTSE 100 group told investors on Wednesday that the third consecutive unsolicited cash and stock offer, which implied a value of 770 pence per Rightmove share, “remains unattractive and substantially undervalues the company and its prospects”.
Rightmove has highlighted a 12 per cent drop in REA Group shares since its first offer was made public, meaning the equity portion of the bid is worth less, as the UK firm’s board unanimously rejected the offer.
Rightmove remains calm: the British property portal rejects the third offer from the Australian REA
REA, 61 per cent owned by the Murdoch family’s News Corp, says a takeover of Rightmove would “seek to improve the UK property experience for buyers, sellers and renters”, supporting Rightmove’s vision of “giving everyone the confidence that they can take the plunge”.
The latest offer from the Australian property listings website, which follows previously rejected bids of 705p and 749p per share, is at a 12.7 per cent premium to Rightmove’s closing share price on Tuesday of 683p.
Rightmove shares have soared by about 23 percent since early September, when the first REA offering was made.
But Rightmove said on Wednesday: ‘The board… (has) concluded that the increased proposal remains unattractive and substantially undervalues the company and its future prospects.
‘The Board of Directors therefore unanimously rejected the proposed increase on 24 September 2024.’
Under City rules, REA now has until 5pm on 30 September to announce a firm intention to make a bid for Rightmove or withdraw.
REA said on Wednesday it remains in the race to acquire the British firm, despite having had “no substantial engagement with Rightmove”.
The group said: ‘REA continues to firmly believe that the enhanced proposal represents a highly attractive proposition for Rightmove shareholders with a significant premium to the relevant business metrics, providing a combination of immediate cash value certainty whilst giving Rightmove shareholders the opportunity to benefit from the future value creation of the combined business.
‘REA urges Rightmove shareholders to encourage the Rightmove board to engage in constructive discussions with REA to work towards a recommended transaction, prior to the next deadline (30 September).’
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