REA Group May Acquire UK’s Property Portal Rightmove
Australia’s REA Group, majority-owned by media mogul Rupert Murdoch’s News Corp, on Monday said that the company was considering a possible “cash and share” offer for acquiring the UK’s largest property portal Rightmove in a deal that could be valued at around $5.73 billion.
Following the news, the London Stock Exchange-listed Rightmove’s shares soared by as much as 25% in early trading, adding over $1.31 billion to its market valuation.
REA Group said this in a disclosure with Australian Securities Exchange (ASX) following media speculation that it was looking into the proposal. However, a clear picture is expected to emerge by end of this month.
The REA Board said that there were clear similarities between REA and Rightmove in terms of their leading market positions in the core residential business, continued expansion and innovation of offerings across adjacent segments, leading audience share and strong brand awareness, as well as highly aligned cultural values.
“REA sees a transformational opportunity to apply its globally leading capabilities and expertise to enhance customer and consumer value across the combined portfolio and to create a global and diversified digital property company, with number 1 positions in Australia and the UK,” the Australian company said.
Investment Opportunities
The REA Board also believe the enlarged group would represent a highly attractive investment opportunity for both REA and Rightmove shareholders, combining robust growth with strong margins and significant cash generation, enabling continued capital appreciation and shareholder returns.
REA therefore considers that a combination of the two businesses would provide a significant opportunity to unlock shareholder value.
REA has a long history of growth and has demonstrated a track record of building businesses over decades to create globally leading platforms that have transformed the way people experience property.
With an acquisition of Rightmove, REA would look to enhance the UK property experience for buyers, sellers and renters, supporting Rightmove’s vision “to give everyone the belief they can make their move” while positively contributing to the property market ecosystem with investment and innovation.
There can be no certainty that an offer will be made, nor as to the terms on which any offer may be made. REA shareholders do not need to take any action at this time.
The Rule 2.6(a) of the Code requires that REA must, by no later than 5 p.m. (London time) on 30 September 2024, being the 28th day following the date of this announcement, either announce a firm intention to make an offer for Rightmove in accordance with Rule 2.7 of the Code or announce that it does not intend to make an offer for Rightmove, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies.
This deadline will only be extended with the consent of the Takeover Panel, in accordance with Rule 2.6(c) of the Code. In accordance with Rule 2.5(a) of the Code, REA reserves the right to introduce other forms of consideration and / or vary the mix or composition of consideration of any offer, REA Group added.
