Foxtons under pressure from shareholders to sell the business
Foxtons’ board is under mounting pressure to sell the business, after an investment fund with a 4 per cent stake in the estate agency joined calls for a sale.
Milkwood Capital, a fund that specialises in investing in companies it deems undervalued, is the latest company to push for the company to sell up, taking the total of proportion shareholders pushing for the move up to 10 per cent.
Its boss, Rhys Summerton, told the Sunday Times: “In 2015, Foxtons was a £1bn company, but the public markets are no longer valuing the good work the management has done recently and the only way to extract fair value is for the board to carry out a sale process.”
The demand comes amid a wider trend of acquisitions and mergers sweeping through the estate agency industry as firms attempt to drive growth amid a sector-wide slowdown.
Foxtons itself recently bolstered its rentals business, snapping up Ludlow Thompson, a London-based lettings agency, for £10m.
And in October, Dexters announced its acquisition of multi-national estate agents LiFE Residential, having acquired Marsh & Parsons in January, taking the number of offices it operates across London to 155.
Eighteen months ago, Canadian investor Converium Capital, which owns six per cent of the Foxtons, also started lobbying the company’s board for a strategic review over a potential sale.
One of the investment management firm’s managing partners, Michael Rapps, said that the CEO and chair have led an “impressive turnaround” at Foxtons.
He added: “As the largest estate agent in London with a significant recurring revenue lettings book, Foxtons is a highly strategic acquisition target.”
Foxtons has been listed on the London Stock Exchange since 2014. Having initially listed at 230p a share, the share price doubled within its first six months as a quoted company to an all-time high of 399p. Since then, its share price has steadily declined, closing on Friday at 40.5p.
Foxtons declined to comment after an approach from City AM.