Countrywide’s share price increased by over 21% yesterday after Connells confirmed an improved £112m takeover bid for the estate agency group.
Countrywide’s share price closed on Monday at 310p, up 21.5%, as it continued on an upward trajectory.
Countrywide’s share price has doubled over the past six weeks, having hit 155p in late October, after the group announced that it needs to restructure its existing debt in order to reduce its debt burden and exposure to creditors.
Earlier this year – on 28 May – Countrywide’s share price dropped to just 54.5p following a multi-month decline, driven primarily by the coronavirus pandemic and the collapsed sale of Countrywide’s commercial arm, Lambert Smith Hampton.
The latest boost in Countrywide’s share price was driven by Connells’ announcement yesterday morning that it had stepped up its efforts to acquire Countrywide after making a new and improve offer to buy the estate agency group.
Having seen its offer of 250p cash per share, valuing Countrywide at £82m, “unanimously rejected” by the Countrywide board last week, the company has returned with an improved cash offer at a price of 325 pence per Countrywide Share, valuing Countrywide at £112m.
The deal would take it back into private ownership and see all of Countrywide’s lenders repaid in full.
In a brief update to the market, Countrywide said: “The board will evaluate the merits of the Connells firm offer in consultation with the company’s major shareholders, together with all other available options for the company, including the revised proposal from Alchemy.”
Alchemy Partners is also attempting to buy Countrywide.
The private equity firm has made a proposed offering of 250p for each of the estate agency company’s shares and a £70m capital raising that would enable other shareholders to keep stakes in the company.
Alchemy says that it has secured letters of intent from shareholders holding a total of 44.8% of Countrywide’s share capital.
Those supporting the proposal include Oaktree Capital, which has an 18.2% stake, and Hosking Partners, which owns 15.6%.
Under Alchemy’s proposal Countrywide would keep a standard listing on the London Stock Exchange unless at least 75% of shareholders voted otherwise.
The Countrywide statement issued yesterday by the board urged shareholders “to take no action at this time in relation to the Connells Firm Offer”.
Comments (3)
After Connells critical comments on Countrywide after their due diligence, they manged to put their hands down the back of the sofa only to find an extra £30m. Perhaps this business is a little more valuable than they want to let on. Meanwhile Rishi Sunak is still sitting by the phone waiting for a furlough reimbursement.
£112m still seems like theft.
Looks like a further game of ping pong into the New Year .The timescale for responses to the offer now takes us into the New Year .
Shareholders will be keen to find out how all the activity at the coalface which has taken place in H2 has translated into improving the company’s financial position before making any decisions.Yet to be updated which is remiss of the BODS.
November has been a particularly good month on the sales front despite the Central London offices being still very pedestrian.Hamptons Islington office though is going great guns with over £60m of sales inventory in solictor’s hands.
Should imagine the bill for the professionals feesfest incurred in the corporate action is taking a big bite out of current revenue .Shareholders will also be keen to know what the golden goodbye packages which have been gifted to Long& Creffield have amounted to .
With both parties unlikely to garner the necessary 75% this is likely to run and run
Certainly shareholders are more confident the arrival of Bowcock into the hot seat will be serving their interests better
You also have to feel for the staff at Lambert Smith Hampton .Unloved by Countrywide they have been hawked around the market like secondhand goods for over 12 months .Expecting everyday to find themselves being punted on ebay
“Buy it now or best offer”
Meanwhile going about the day job in a quiet professional manner . Still doing the deals Recently 2 of the Directors have been appointed by the Gov’t to participate in the task force of tackling problems in the High Street ,a £8.6m contract
A prestige appointment at least they are loved by someone.
The irony is not lost they will be advising on empty estate agents offices