Rightmove rejects £5.6bn takeover bid from Rupert Murdoch’s REA
Rightmove said the proposal ‘fundamentally undervalued’ the firm.
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Your support makes all the difference.Rightmove has rebuffed a takeover proposal from Rupert Murdoch’s REA Group in Australia, valuing the UK online property portal at more than £5 billion.
REA, which is majority-owned by the business magnate’s News Corp, confirmed it had put forward an approach for a cash-and-shares deal, which it said would be worth around 705p a share, valuing Rightmove at about £5.6 billion.
London-listed Rightmove said the takeover proposal “fundamentally undervalued” the firm.
Rightmove claimed that, based on REA’s closing share price on September 10, the proposal would value each Rightmove share at 698p, or £5.5 billion.
The board carefully considered the proposal, together with its financial advisers, and concluded that it was wholly opportunistic and fundamentally undervalued Rightmove and its future prospects
Rightmove said: “The board carefully considered the proposal, together with its financial advisers, and concluded that it was wholly opportunistic and fundamentally undervalued Rightmove and its future prospects.
“Accordingly, the board unanimously rejected the proposal on September 10 2024.
“Rightmove shareholders should take no action in respect of the proposal.”
Under the terms of the possible deal, Rightmove investors would own around 18.6% of the enlarged group.
REA’s proposal would see the combined group apply for a secondary listing in London following the takeover, with its shares traded both on the London Stock Exchange and the Australian Securities Exchange.
“This would provide the opportunity for a wider pool of investors to gain exposure to a global and diversified digital property company on the London Stock Exchange,” REA said.
It added that the deal would “unlock value for both Rightmove and REA shareholders by creating a global and diversified digital property company, with strong margins and significant cash generation, underpinned by number one positions in Australia and the UK”.
REA said it would use its “capabilities and expertise” to “enhance the UK property experience for buyers, sellers, and renters, positively contributing to the property market ecosystem”.
REA has until 5pm on September 30 to make a firm offer or walk away under City Takeover Panel rules.
Rightmove is the UK’s largest online real estate portal, while its suitor is Australia’s largest property website.
Founded in a garage in Melbourne, REA has expanded its operations throughout the country, while it also has businesses in India and south-east Asia.
According to REA’s website, it employs more than 2,800 people.