Leading City adviser gives OnTheMarket deal thumbs up
Independent proxy adviser ISS recommends shareholders vote ‘for’ acquisition of OnTheMarket PLC by CoStar UK supporting the Board's recommendation.
Leading independent adviser Institutional Shareholder Services (ISS) has thrown its weight behind the OnTheMarket Board and recommended shareholders vote ‘for’ the planned acquisition by CoStar UK at the Court and General Meeting next month.
ISS is a leading independent proxy voting and corporate governance advisory firm whose recommendation often influences how certain pension funds, investment managers, mutual funds and other institutional shareholders vote.
MAJOR BOOST
The OnTheMarket Board had already unanimously recommended the deal and the backing of ISS will give the prospect of the planned sale a major boost after coming in for criticism by City activist Brett Stone.
US giant CoStar made the £99 million bid last month, with the 110p per share offer price a 56% premium to the last close price, though below short-term levels seen in 2019 and 2021.
In a statement OnTheMarket welcomed the positive voting decision and reiterated its unanimous recommendation for Shareholders to vote in favour of the deal stating that CoStar was committed to“maintaining fair and sustainable pricing for agents and intends to continue charging agents a small proportion of Rightmove’s current charges”.
The statement also says: “CoStar is seeking to create the number one agent-friendly UK residential property portal and a genuine disruptor to the established market leaders.”
MATERIAL ACCELERATION
And it adds: “The level of investment CoStar intends to deploy represents a material acceleration of OnTheMarket’s existing strategy in this regard.
“CoStar will invest to grow traffic to OnTheMarket’s portal, for the benefit of OnTheMarket’s agent clients.”
The Neg reported earlier this month how Stone was continuing his sabre rattling against Washington D.C. based CoStar Group’s proposed acquisition of OnTheMarket AFTER the former’s lawyers Latham & Watkins requested he makes no more public statements.
Earlier this week he asked the UK government to investigate the proposed sale in his latest attempt to derail the £99 million deal.
I have a direct network of over 8,500 agents, and when big events happen I usually get a few hundred messages about how they feel about things. Regarding the CoStar deal with OTM the sentiment is strongly supportive of the deal, reasons ranging from many agents saying it will make it very difficult for Rightmove to put up its fees next year, if a bigger contender enters the ring, to the fact that OTM is being run by an ex-agent who understands them, rather than executives running the show who live in ivory towers.
Obviously property portals have various clients not just agents – bu the agent centric nature of OnTheMarket has always got my vote – it is an enabler rather than just looking to maximise its revenue for shareholders.