Rightmove rejects fourth bid from REA

Rightmove has rejected a fourth offer from Rupert Murdoch-backed REA Group, valuing the company at £6.5bn, and given the Australian listings firm a 5pm “put up or shut up” deadline to make a best and final bid. REA made its latest offer on 27 September, offering 346p per share in cash plus 0.4 REA shares and a special dividend of 6p per share, as it pursued its ambition to create a property listings giant. The group believes a combination of the two business will create a “true global technology leader”. REA chief executive Owen Wilson said: “While the Rightmove board has refused to meet with us, we have enjoyed the opportunity to connect with Rightmove shareholders and to share our vision for the combination of the number-one digital property businesses in the UK and Australia. “We continue to see the potential for us to strengthen Rightmove and accelerate its growth. This is a compelling opportunity to create a true global technology leader on the London market via a secondary listing, operating in two of the most attractive markets in the world.” He added: “We have further improved our offer, and intend to include a mix-and-match facility for shareholders who wish to receive a greater proportion of their consideration in REA shares to do so.” Rightmove had until today to respond to the offer. Rightmove chair Andrew Fisher said: “We respect REA and the success they have achieved in their domestic market. However, we remain confident in the stand-alone future of Rightmove. Rightmove has been the leading operator in the UK for over 20 years, and it has differentiated market presence, branding and technology, and very significant opportunities for future growth.” Rightmove said the current offer remained unattractive and continued to “materially undervalue Rightmove and its future prospects”. REA has repeatedly hit out at Rightmove to failing to interact with it during its approaches, saying that it has repeatedly requested meetings but been knocked back. “There has been no substantive engagement beyond cursory procedural telephone calls with the Rightmove chairman,” said REA. Rightmove said it had known the REA team for “many years” and had had numerous interactions, including discussions around strategy and best practice as recently as June. It said it had declined requests from REA to grant due diligence access as none of its proposals to date had been at a sufficient level to grant such access. The firm said: “Rightmove has taken every phone call that REA has made since its interest was first made public, with a level of engagement which in Rightmove’s view is customary and appropriate in the context of an unsolicited and unilateral series of approaches, made to a UK listed company, where the possible offeror is taking an incremental and iterative approach to price discovery.  “Following the receipt of the latest proposal, Rightmove’s chair, Andrew Fisher, agreed to meet with Hamish McLennan, the chair of REA. The purpose of this in-person meeting was to allow the chair of REA an opportunity to present the latest proposal and engage in discussions with the chair of Rightmove, ensuring that the Rightmove board was fully appraised of all information of relevance to its ongoing deliberations.” The company added:  “Nothing was presented in either meeting which materially changed the board’s view of the latest proposal. In addition, the meetings confirmed Rightmove’s confidence in its current strategy and execution within a UK context.” REA first approached Rightmove on 2 September.