Rupert Murdoch’s REA Group in Australia has made a third approach for Rightmove worth more than £6 billion as it ups its campaign to take over the UK property portal.
REA, which is majority-owned by the tycoon’s News Corp group, said it put forward a 770p-a-share proposal on September 22 valuing Rightmove at about £6.1 billion.
It comes after REA first tabled a possible offer in early September, valuing Rightmove at £5.6 billion, but its advances have so far been rejected by the London-listed firm.
While not giving its verdict on the approach, Andrew Fisher, chair of Rightmove, said the previous two proposals were “uncertain, highly opportunistic and unattractive”.
“Accordingly, the board unanimously rejected them.
“The board will continue to act on behalf of our shareholders and respond to the most recent proposal in due course,” he added.
REA said it was “genuinely disappointed” that Rightmove’s board has not yet come to the table to talk.
Owen Wilson, chief executive of REA, said: “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.”
He added that the cash-and-shares proposal “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,” he added.
Rightmove said the initial 705p-a-share approach on September 5 “fundamentally undervalued” the firm and was “wholly opportunistic”.
Its suitor then increased the proposal to 749p a share on September 16, before the latest move on Sunday.
REA said that aside from having the approaches rejected, it has had “no substantive engagement with Rightmove”.
“REA is announcing the terms of the further improved proposal to provide shareholders of both companies with the opportunity to make their views known… and to urge Rightmove shareholders to encourage the board of directors of Rightmove to engage in constructive discussions with REA to work towards a recommended transaction,” REA said.
Under the terms of the third approach, Rightmove investors would own around 20% 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.
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 REA is Australia’s largest property website.
Founded in a garage in Melbourne in 1995, REA has expanded its operations throughout the country, while it also has businesses in India and south-east Asia.
It is valued at about 27 billion Australia dollars (£13.9 billion) on Australia’s stock market and employs around 3,400 staff.
Shares in Rightmove lifted 2% in Monday morning trading, to just under 690p a share.
Panmure Liberum said REA’s third tilt at Rightmove “still leaves much to be desired”.
Jessica Pok, an analyst at Peel Hunt, echoed the sentiment.
She said: “We believe the offer is still not at the level investors would entertain.
“As a standalone business, the future prospects for Rightmove continue to be strong, with an improving UK housing market and opportunities to expand.”
