Rightmove, a renowned British online property website, rejected an enhanced offer from REA Group on Monday. REA Group is a prominent Australian online property business, primarily controlled by Rupert Murdoch’s News Corp empire. The reported proposal made on Friday was valued at £6.2 billion (US$8.3 billion), showing a slight increase from the previous non-binding proposal of £6.1 billion.
Fourth Proposal Rejected
The offer comes ahead of a Monday deadline at 1600 GMT for REA to either present a formal bid or back out according to UK takeover regulations. Rightmove, in a press release to the London Stock Exchange, stated that the recent proposal “remains unattractive and continues to significantly undervalue” the company and its prospects.
In response to REA, Rightmove’s Chair, Andrew Fisher, appealed: “I urge them to submit a final and best proposal ahead of today’s… deadline such that we can bring certainty to this process.”
REA’s Interest in Rightmove
REA initially expressed its interest on September 2. The first takeover proposal was valued at £5.6 billion, but no official figure was provided for the second bid.
- Sector observers have suggested that REA, operating property-listing websites in Australia, Asia, and North America, might be enticed by the possibility of additional interest-rate cuts in Britain. These cuts could potentially lower mortgage costs for buyers.
- Analysts have also noted that plans by Britain’s new Labour government for mass house building could further enhance Rightmove’s appeal. Rightmove also lists properties for rent.
“We respect REA and the success they have achieved in their domestic market,” Fisher stated on Monday. He continued, “However, we remain confident in the standalone future of Rightmove…, the leading operator in the UK for over 20 years.”
REA’s Future Plans
REA has stated that should it succeed in buying Rightmove, it would apply for a secondary stock market listing in London, in addition to its current trading on the Australian Securities Exchange.
The takeover attempt comes at a time when Murdoch, aged 93, finds himself amidst a legal controversy. Several of his children are seeking to prevent him from altering the terms of a family trust. Their attempt is to ensure that his favored son, Lachlan, gains control of his expansive media assets after his death.
This developing story will undoubtedly continue to attract the attention of those interested in international business and property markets. Whether Rightmove ultimately accepts a proposal from REA Group remains to be seen.
