Rightmove rejects latest takeover offer amid warnings of hostile bid
The board at Rightmove unanimously rejected a third offer from Aussie portal firm REA prompting more frustrated comments from REA.
Rightmove has rejected the latest offer from Australian firm REA Group amid warnings that a hostile takeover may be attempted.
REA and its CEO Owen Wilson intensified efforts to buy Rightmove earlier this week when the Australian firm made a third bid with an increased offer for the portal up by nearly 10%.
The group raised the price it is willing to pay for Rightmove’s stock to £7.70 a share valuing Rightmove at £6.1 billion, or a 39% premium to Rightmove’s current £5.56p a share price.
But the Rightmove board has again voted unanimously to reject the offer, prompting more frustrated comments from REA at Rightmove’s “continued refusal to engage”.
REA has still had no substantive engagement with Rightmove.”
“REA is disappointed by the latest rejection from the board of directors of Rightmove and is frustrated that, save for the rejection of REA’s three previously disclosed proposals, REA has still had no substantive engagement with Rightmove.
“REA continues to firmly believe that the further improved proposal represents a highly compelling proposition for Rightmove’s shareholders at a significant premium”, REA said in a statement to the City.
Rightmove said: “The board considered the increased proposal, together with its financial advisers, and concluded that the Increased proposal continues to be unattractive and materially undervalues the company and its future prospects.”
Hostile bid
Sean Kealy, City analyst at Panmure Liberum, has warned that REA could go directly to Rightmove’s shareholders, bypassing the board, in a ’hostile bid’ to secure a deal.
“We note the toughening of language in the third offer, as well as REA’s publication of a supplementary presentation detailing the offer.
“We expect that it will likely choose to approach shareholders over the Rightmove board at this stage, if it hasn’t already,” he told The Times.
Under City rules, REA has until Monday next week to reach agreement on a deal with Rightmove or withdraw.
