One of the most extraordinary flurries of industry acquisition and mergers and has been topped this morning by Foxtons, which has bought competitor London agency Douglas & Gordon (D&G) for £14.25 million.
Foxtons has bought the entire issued share capital of D&G from its controlling Talbot Willcox family and employee shareholders.
Negotiations over the deal were leaked last week but had been ongoing for several weeks beforehand.
The purchase of D&G is part of its new strategy of gaining market share predominantly in the lettings market through acquisitions rather than cold-start branch openings, as had been the case until recently.
Foxtons closed six of its unsustainable suburban and expensive central London branches in 2018.
The purchase of D&G brings another independent agency into the corporate fold – the company was established in 1958 just off Sloan Square in central London and by the 1990s had become one of the dominant agencies on the London scene. Some 65% of its income comes from its 2,900 tenancy lettings book.
Chairman and lead shareholder Michael Hodgson, who has led the business for 42 years will now step down, leaving Evans and the established management team to drive and grow the business under the Foxtons Group’s ownership.
D&G will continue to be run as a separate business and with the existing management team remaining in place.
“We’re really pleased with the deal, and have great admiration for Foxtons as a business, brand and competitor,” says Douglas & Gordon CEO (left) James Evans.
“Our offer is complementary to theirs and we know that with their backing, the Douglas & Gordon business can go from strength to strength. We really look forward to working together to better serve buyers, sellers, landlords and tenants.”
Foxtons CEO Nic Budden (left) says: “Douglas & Gordon is a business we have long admired and respected. Like us, it is a business with intimate knowledge of the London market and a culture built around delivering results for customers making it an excellent strategic fit.
The purchase of D&G is Foxtons’ fourth acquisition in a year but its biggest. Others have included London Stone, Pillars Estates and Aston Rowe.”
Ed Mead, former D&G exec and Viewber founder
“Many people worked hard to build the Douglas & Gordon brand and it’s reassuring that Foxtons have decided to keep it and that we’ll see the name surviving on the High Street.”
Anthony Codling, Twindig
“In some senses, it is a strategic step change for Foxtons who have always believed that their strong culture meant that organic growth was best and that taking outside help was a sign of weakness – if you hire externally or seek growth externally are you saying that you cannot achieve that growth or grow those skills in house?
“That said, in my view. D&G is a high quality business and Foxtons is aware that you don’t look a gift horse in the mouth. Such a meeting of minds makes sense, the challenge will not be the logic of the acquisition, but keeping hold of the landlords they acquire.”