Connells ups offer for Countrywide to £112m

Connells has raised the stakes in its bid to takeover Countrywide, upping its offer for the business by 30% to £112m. It marks a fresh bid for the business after Countrywide’s board rejected Connells’ original bid of £82m last week. The new offer represents £112.1m for ordinary share capital and an enterprise value of £200.2m. Connells said Countrywide shareholders would receive “immediate, certain and significant value, at a 124% premium to Countrywide’s unaffected share price”. If the bid is accepted, all of Countrywide’s lenders will be able to be repaid in full and additional investment will be provided for the business to “recover from the under-investment of recent years”, Connells said. Last week, Countrywide rejected Connells’ previous bid and instead recommended a revised proposal from private equity firm Alchemy Partners, which would see the Alchemy buy shares at 250p per share. Connells claimed that its new offer is “significantly superior” to Alchemy’s bid, suggesting it would leave Countrywide with “high levels of debt and significantly less capital than even the discredited first proposal from Alchemy”. Connells said the revised proposal from Alchemy is “complex, highly conditional and unclear in many important respects”, claiming that it would offer less value to shareholders than a cash offer, and that there is “absolutely no certainty” that the deal could be delivered or that a turnaround plan would be successful. Connells group chief executive David Livesey said: “Putting Countrywide back on track requires sustained investment and gritty operational improvement over many years. Connells is offering a clear vision for the future, not yet another turnaround attempt based on wishful thinking and flaky financing. “Connells’ cash offer of 325 pence per Countrywide share is the only tangible deal on the table and gives Countrywide shareholders a huge premium over the value of their Countrywide shares before we announced our interest.” In a statement responding to the offer, Countrywide said it would “evaluate the merits” of Connells’ fresh offer “together with all other available options for the company, including (but not limited to) the revised proposal from Alchemy announced by the company on 2 December 2020 and a capital raise from existing shareholders of the company”. To send feedback, e-mail lucy.alderson@egi.co.uk or tweet @LucyAJourno or @estatesgazette Photo by Shutterstock