BREAKING: Is major industry figure Robin Paterson eyeing up Countrywide?
Paterson owns Sotheby's Realty UK, helped expand Hamptons International and Barnard Marcus during the 1990s and recently set up an investment LLP to buy Countrywide shares with a former owner of Humberts.
A high-profile industry figure with a distinguished track record going back to the 1990s has been quietly increasing his holdings in beleaguered estate agency giant Countrywide, The Negotiator can reveal.
Robin Patterson (above), who was a key figure in the expansion of both Hamptons International and Barnard Marcus before they were sold to larger groups, has been using a recently-established investment vehicle to hoover up shares in Countrywide.
The buying spree by Real Estate Investments 1 LLP, which trades as Catalist Partners, means it now holds 9.34% of the company’s shares after buying its first tranche on 7th July, followed by two more acquisitions in recent days.
Real Estate Investments 1 LLP was incorporated in May and its directors are Robin Paterson, Matthew Spence – the CEO of Natural Retreats that briefly recently owned Humberts – plus banker Paul Coles and former Nomura MD Joshua Ponniah.
Sizeable shareholder
There are only a handful reasons why an LLP like this might form – either to make a quick buck from the property industry as its key PLCs revive and their share prices rise; as part of a potential takeover bid for Countrywide; or – as a large shareholder – a way to influence the direction of the company.
Paterson has strong links to the estate agency business. In 1987 he purchased Barnard Marcus before selling it on to Sequence, lead a consortium that bought Hamptons International before selling it in 2004, was a major shareholder in Cluttons and more recently bought both UK Sotheby’s International Realty and Coldwell Bank Commercial.
He would therefore be well placed both given his experience and deep pockets to lead a friendly or hostile takeover of Countrywide, although there is no evidence to prove that such a strategy is being undertaken.
Countrywide’s share has been rising in recent weeks, by nearly 38% since it was reported that Peter Long, the company’s executive chairman since Alison Platt left in early 2018, is to step down from his leadership role as the company looks for a new CEO.
Countrywide Plc, has about 690 physical branches, and in excess of 9,000 in the business, I famously stated in the Daily Telegraph earlier this year that Countrywide’s (or any agents) ‘failure to embrace the Proptech Revolution will make it a financially wounded dinosaur.’
So, there are a number of problems with a hostile bid, not least that five years ago, buying brands – Hamptons International, Taylors, etc would have been seen as a way to asset strip a business, now in the digital age, with a ‘hub’ and tech enabled salesforce, is it not cheaper to set up an agency than buy crumbling high street offices which no one visits? So what are you buying?
There is an argument that the value of buying Countrywide is its financial services and surveying business, here again, automation is rearing its head, fifteen years ago you needed a physical branch to capture the vendor/buyer and then at point of sale the mortgage business etc.
Now proptech is allowing the consumer to digitally find finance and automation of mortgage lending is increasing, a mortgagee may need to interface with a mortgage broker to get a mortgage, but that broker can do it from home in their bermuda shorts, again no need for physical branches.
The other big kicker is pension liabilities with a large workforce, this is a factor, and whoever become the new Chair and whoever becomes the new CEO – vacancy sine 2018, will their first job be a cull, that is going to be very costly.
Whatever Robin Paterson has in mind, he and his consortium have to be careful of the future value of any assets in the tricky ever changing world of real estate, where solid assets are increasingly being digitized. No point in owning Woolworth’s if everyone is buying Pick/Mix online?