Connells raises its buyout offer for Countrywide plc to £164.5 million
- Connells raises its buyout offer for Countrywide plc to £164.5 million.
- The revised offer values Countrywide at 325 pence per share.
- Countrywide rejected a cash injection proposal from Alchemy Partners.
In a statement on Monday, Connells Ltd revealed its upwardly revised buyout offer of £164.5 million for the UK’s largest property group, Countrywide plc (LON: CWD). Countrywide had rejected the initial buyout offer from the real estate management firm last month.
Countrywide shares opened about 20% up on Monday and gained another 0.5% in the next hour. Including the price action, the property developer is now trading at 307 pence per share that represents a close to 5% growth year to date in the stock market after recovering from a low of 39 pence per share in the first week of April. The price action should come in handy if you are interested in investing in the stock market.
The revised offer values Countrywide at 325 pence per share
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The revised offer translates to 325 pence per share and is 30% higher as compared to Connells original offer that valued Countrywide at 250 pence per share. CEO David Livesey of Connells said on Monday:
“Countrywide desperately needs a deliverable solution to its current financial problems and lack of strategic direction.”
Countrywide is yet to make an official statement in response to Connell’s revised offer on Monday. In separate news from the United Kingdom, British luxury clothing retailer, Ted Baker, said on Monday that its pre-tax loss widened in fiscal H1 due to the ongoing Coronavirus pandemic that has so far infected more than 1.7 million people in the UK and caused over 61 thousand deaths.
Countrywide has been struggling to pull out of the impact of its poorly carried out restructuring in 2015 that fuelled financial challenges, including a significantly discounted share issue and four profit warnings in recent years.
Countrywide rejected £90 million proposal from Alchemy Partners
Earlier this year in October, Countrywide said it received a proposal for a cash injection from Alchemy Partners. The private equity firm demanded management control for a nearly £90 million investment in the property developer. Countrywide rejected the proposal in the last week of November as it announced Philip Bowcock as its interim CEO. Countrywide said last month:
“Bowcock will lead the discussions with major shareholders towards stabilising the company’s capital structure, and discussions with Alchemy Partners and Connells in relation to their proposals.”
Countrywide performed fairly downbeat in the stock market last year with an annual decline of a little under 20%. At the time of writing, the London-based company is valued at £153.57 million.