Rupert Murdoch’s REA Group has shown how keen it is to acquire Rightmove by coming back with a higher bid after an initial approach was rejected.
REA has made a improved proposal to acquire Rightmove, offering 770p share in a cash and stock deal. This latest offer, made on September 22, 2024, values Rightmove at approximately £6.1 billion and represents a 9.2% increase from REA’s initial proposal on September 5.
The new offer consists of 341p in cash and 0.0422 new REA shares for each Rightmove share.
The revised offer price represents a significant premium to Rightmove’s recent trading prices, including a 39% premium to its undisturbed share price on August 30, 2024. This move follows Rightmove’s rejection of REA’s previous improved offer of 749p per share on September 18, which the Rightmove board deemed as fundamentally undervaluing the company.
We will have to wait and see whether the Rightmove board see any merit in the revised offer, but it isn’t a huge increase on the initial offer.
“We believe that the combination of our world-leading expertise and technology with the attractive Rightmove business will create an enhanced experience for agents, buyers and sellers of property,” said Owen Wilson, CEO of REA.
“We live in a world of intensifying competition and this proposed transaction would bring together two highly complementary digital property businesses for investment and growth. We have today increased our proposal to an implied value of 770 pence – it provides a combination of immediate value certainty in cash and at the same time gives Rightmove shareholders an increasing opportunity in core digital property and adjacencies where we have much expertise. We are genuinely disappointed at the lack of engagement by Rightmove’s Board and we strongly encourage the Rightmove Board to engage.”
Rightmove is the UK’s leading property portal, and for it to fall into overseas hands at a low valuation will be a blow to London’s markets.