OTM has ‘failed to deliver’ on its promise to break portal duopoly – challenge
Businessman Brett Stone says in open letter to industry that time has come for change including replacing chairman Christopher Bell and a new direction.
A potential investor in OTM has written a provocative ‘open letter’ to agent stakeholders in the portal both criticising its lack of success against Rightmove and Zoopla, questioning its business plan and calling for executive chairman Christopher Bell to be replaced.
Brett Stone, a British entrepreneur who has a background in finance, but now runs a London-based firm called Edengen, says he’s spoken to many of the estate agents among its 3,600 shareholders and believes the time has come for change.
He says two key deadlines are facing the portal which, he claims, were not mentioned recently within its recent trading update, but that would facilitate change.
Cancel contracts
These are that shareholding agents will be able to cancel their contracts for the first time in five years, and that member agents will be able to sell a significant number of shares for the first time (also for five years) from 09 February after their lock-in periods expire.
“Over the last three months, I have met with estate agents big and small to understand their views,” says Stone.
Each has a unique set of circumstances, but the majority are seriously questioning whether it is worth continuing to pay to list their properties on OTM.”
He goes on to claim that OTM has failed to deliver on its founding mission to rebalance the power between agents and Rightmove and Zoopla; lacks scale and has significantly underperformed; and that for agents rising interest rates, high inflation and property market uncertainty “makes OTM an increasingly unnecessary expense”.
Stone’s intentions are not entirely altruistic and in the letter he says he’d like to have an active role in running the portal in place of Bell in return for new cash. He says initial overtures to the portal’s board to offer new capital that would “put OTM on the same financial footing as Rightmove and Zoopla” were rebuffed.
He says his company has “opportunities to deploy capital ranging between US$5 million and US$250 million”.
OTM response
“The Board of OnTheMarket received a letter from Brett Stone in late 2022 and after careful consideration, unanimously agreed his proposal was detrimental to stakeholders. Mr Stone is not a shareholder in OnTheMarket, did not provide any evidence of shareholder support for his proposal or any details of any available funding.
“The Board consider that OnTheMarket has strong prospects as an independent business, as evidenced by our recent trading update which showed record revenues and profitability, alongside on-going strategic progress. The Board also place great value on OnTheMarket’s majority agent owned shareholder structure and believe that this continues to benefit all of the Company’s stakeholders and the property market as a whole.”
