Countrywide will soon face a takeover attempt, predicts industry watcher
John Bodinham says Robin Paterson is well placed to lead a takeover attempt, which 'cannot come soon enough'.
John Bodinham, an industry watcher, minior Countrywide investor and former agent, says his gut feeling is that the company is very likely to face a takeover attempt sooner or later.
The 64-year-old, who is based in Wales and has a substantial track record in the residential and commercial property sectors, says his research into Countrywide points to a takeover attempt by Robin Paterson soon.
As The Negotiator recently reported, Paterson has been buying up Countrywide shares in recent weeks and now owns just over 10% of its stock.
Bodinham reckons Paterson is a bit too ‘long in the tooth’ to hang around and would have no difficulty getting some investors on board to join him ‘as he is a performer’.
Successful career
“Paterson has enjoyed a long and successful career so this could be a last roll of the dice – therefore why bother making a move unless you are going to go the whole hog,” says Bodinham.
He says an offer of £2.75 a share ‘would win the races’ which would value the company at approximately £95 million.
“Add on the estimated £75 million debt the company is carrying and you have £170 million for a clean slate – I think this is a really exciting opportunity.”
Bodinham’s research, shown to The Negotiator, reveals that many of Countrywide’s brands and branches are in reality doing very well outside of London with some branches having 70% of their stock SSTC, and that he is baffled that the current management continue to struggle to turn the company around – as Paterson documented at length last week.
A Countrywide shake up is very imminent, I think the debt analysis is closer to 90M, off the top of my head I think 7.5M alone, a year is set aside to cover non profit making offices alone, where the strategy is to keep the lights on rather than pay huge rents on empty units. And i think they spent 2M recently looking at expert ways to save money, but none of this was implemented.
Hopefully, and Patterson is correct, some asset stripping, and the application of a cohesive proptech utilisation, as set out in his brilliant open letter to the embattled chair at Countrywide, will result in a trim, profitable and formidable agency, much like the Countrywide I was proud to work for in the 1980’s.
For me, in six weeks you can turn a loss making agency business around, with 690 physical branches, trimmed to 400, within 6 months, you could have a business that duplicates the profitability of the Skipton Building society model. Which is based upon strong management from the top, with a shared, driven core objective, high levels of service, equals profit.