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Connells ups offer for struggling Countrywide to £112m

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  • 07/12/2020
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Connells ups offer for struggling Countrywide to £112m
Connells has increased its takeover offer for ailing rival Countrywide in a deal worth around £112m.

 

Connells has now made a firm offer of 325p per share, a 30 per cent increase on the previous bid of 250p a share which was turned down by shareholders.

In a statement, Connells said under its “experienced and successful management team”, Countrywide’s business would be stabilised and enhanced.

Additional investment for the group would be provided to help Countrywide recover from the “under-investment of recent years”.

It also criticised the rival bid

The estate agent said it believes its offer is “significantly superior” to a revised transaction involving private equity firm Alchemy, which it said was based on “wishful thinking and flaky financing”.

Countrywide shareholders recently rejected an initial advance from Alchemy.

Connells said the Countrywide board has said it is in urgent need of recapitalisation to reduce debt and reduce exposure to lenders.

Without a deal, there is a risk that Countrywide could end up in administration, Connells added.

David Livesey, group chief executive of Connells, said: “Countrywide desperately needs a deliverable solution to its current financial problems and lack of strategic direction. Putting Countrywide back on track requires sustained investment and gritty operational improvement over many years.

“Connells is offering a clear vision for the future, not yet another turnaround attempt based on wishful thinking and flaky financing. Connells’ cash offer of 325 pence per Countrywide share is the only tangible deal on the table and gives Countrywide shareholders a huge premium over the value of their Countrywide shares before we announced our interest.

“Although we have approached the Countrywide board to seek its recommendation of our offer, we think it is in the interests of everyone for us to announce our offer today so that all of Countrywide’s shareholders are aware of the compelling nature of our proposal.”

 

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