British property website Rightmove said Wednesday it had rejected a third “unsolicited” proposal, worth £6.1 billion (US$8.2 billion), from REA Group, the Australian peer majority-owned by Rupert Murdoch’s News Corp empire.
“The board… concluded that the increased proposal continues to be unattractive and materially undervalues the company and its future prospects,” Rightmove said in a statement two days after news of the latest non-binding bid.
REA, which first made public its interest on September 2, has noted “clear similarities” between the pair “in terms of their leading market positions in the core residential business”.
Under British takeover rules, REA has until 1600 GMT on Monday to “announce a firm intention to make an offer” or walk away, Wednesday’s statement said.
REA expressed disappointment at the latest rejection and frustration at a lack of “substantive engagement with Rightmove”.
It added in a statement: “REA continues to firmly believe that the further improved proposal represents a highly compelling proposition for Rightmove’s shareholders at a significant premium”.
The first takeover proposal was priced at £5.6 billion. There was no official figure given for the second bid.
The latest offering was priced at 770 pence per Rightmove share, far above its share price of 685 pence in early trading on Wednesday.
Rightmove, which is the only company of its kind on London’s top-tier FTSE 100 index, saw its shares rise 0.4 percent in morning deals — giving it a market value of about £5.4 billion.
– Rightmove’s attractiveness –
Sector watchers said REA — which runs property websites in Australia, Asia and North America — could be attracted by the prospect of more interest-rate cuts in Britain that would lower mortgage costs for buyers.
Plans launched by Britain’s new Labour government for mass housebuilding should provide a further boost to Rightmove, analysts noted.
“With the UK government pledging to build 1.5 million new homes, interest rate cuts eyed and the (country’s) property market springing into life again, Rightmove clearly sees significant growth opportunities ahead,” Susannah Streeter, head of money and markets at Hargreaves Lansdown said Wednesday.
REA has stated that should it succeed in buying Rightmove, it would apply for a secondary stock market listing in London — an addition to its current trading on the Australian Securities Exchange.
The takeover attempt comes as Murdoch, 93, finds himself in the eye of a legal storm as several of his children seek to block him changing the terms of a family trust to ensure his favoured son Lachlan gains control of his sprawling media assets after his death.
