Speculation is mounting that Purplebricks may be brought back into private ownership after its shares dipped to an all-time low last week.

A leading national newspaper tipster has made the claim, citing insider City sources.

They believe that the most likely outcome is for majority shareholder and German media giant Axel Springer to buy the remaining shares off other investors and then take it back into private ownership, Alex Lawson claimed over the weekend within the Mail on Sunday.

Called ‘take backs’ in City circles, removing a company from the rigours of being listed on a stock market – AIM in the case of Purplebricks – can remove many of the PR headaches and costs of having to adhere to City rules and report progress every three months.

Huge distraction

Companies, particularly if they are already struggling and their share prices are near rock bottom, find the pressures of being listed can be a huge distraction for senior management.

For example – Purplebricks would not have had to reveal the financial implications of its tenancy deposit paperwork mistakes if it was a private company.

And share prices can also often be an unfair indication of a company’s value – operationally Purplebricks may be struggling as its core lower-middle housing market has struggled during Covid, but its still the largest estate agency in the UK – and yet its share price has dropped by  95% over the past three years.

It’s not the first time that speculation of a ‘take back’ has risen – in 2019 Axel Springer was reported to be in talks with a US equity firm KKR to take it private.

Purplebricks launched on AIM in January 2015, initially for £1 a share.