Countrywide PLC (LON:CWD) revealed on Monday that it has received an indicative takeover approach from rival estate agency Connells Limited, throwing into confusion the group’s plans for a capital injection from private equity firm Alchemy Partners.
In a brief statement, Countrywide said the offer approach from Connells is at a price of 250p per Countrywide share in cash. Countrywide shares closed trade on Friday at 145p.
The group said the approach is at an early stage and Connells has indicated that any offer is conditional upon, amongst other things, completion of confirmatory due diligence and the recommendation of the board of Countrywide.
There can be no certainty that an offer will be made, nor as to the terms of any such offer, should one be made, it added.
On October 22, when it posted a drop in half-year results, Countrywide unveiled plans for a proposed recapitalisation that includes a fully underwritten equity raising of approximately £90mln from funds advised by Alchemy Partners via a placing and open offer and by funding the repurchase of shares by the company under a tender offer.
Following the recapitalisation, Countrywide said it plans to have a streamlined board, with a new chairman, Carl Leaver, joining the board following completion. Alchemy is also in discussions with a potential new chief executive officer to lead the development of a detailed execution plan following a strategic review.
In the light of recent discussions with shareholders, Countrywide said its board has taken the decision to postpone the general meeting to approve the shareholder resolutions under the proposed transaction announced on October 22, 2020, until further notice.
In the meantime, the company said its board will continue to engage with its shareholders to examine all potential options to deliver a sustainable capital structure for the company and to maximise shareholder value.
A further announcement will be made as and when appropriate, it added.
Back in March of this year, FTSE 250-listed rival LSL Property Services PLC (LON:LSL) dropped plans to bid for Countrywide. No reason was given for the change of heart though Countrywide said its performance has softened “in recent days” due to the impact of coronavirus.