Countrywide accepts the sweetened buyout proposal from Connells
- Countrywide accepts the sweetened buyout proposal from Connells.
- Connells’ 395 pence per share offer values Countrywide at £223.1 million.
- Alchemy had earlier proposed 250 pence per share to Countrywide.
Countrywide plc (LON: CWD) agreed to the sweetened buyout proposal from Connells Ltd on Thursday. It was the second time for the property services company to raise its buyout offer. Other prominent bidders seeking to bring Countrywide under their umbrella included private equity firm, Alchemy.
Countrywide opened more than 12% up on Thursday. Including the price action, the stock is now exchanging hands at 389 pence per share after recovering from a year to date low of 39 pence per share in the first week of April when the impact of the COVID-19 crisis was at its peak.
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The British company had started the year 2020 at 293 pence per share. If you want to invest in the stock market online, you will need a reliable stockbroker – here’s a comparison of the top few to make selection easier for you.
Connells’ buyout offer values Countrywide at £223.1 million
Initially, Connells had offered 250 pence per share to Countrywide. Its recent all-cash proposal that translates to 395 pence per share values the UK’s largest property group at £223.1 million and represents a 14% premium on the price at which Countrywide closed the regular session on Wednesday.
Connells had first sweetened its proposal to 325 pence per share earlier in December. Acting non-executive chairman of Countrywide, David Watson, commented on the news on Thursday and said:
“We have been encouraged by their (Connells’) recognition of the need to put in place a sustainable capital structure and a willingness to support the company, which is a great business that has been constrained by too much debt.”
Alchemy had proposed 250 pence per share to Countrywide
In comparison, Alchemy had proposed 250 pence per share to Countrywide with an added recapitalisation plan valued at £70 million. The private equity firm refrained from commenting on the news on Thursday.
Countrywide rejected the initial offer from Connells in November. Following a botched restructuring in 2015, its financial performance has remained under pressure, worsened further by the Coronavirus pandemic that wreaked havoc on the UK’s housing market earlier this year. In 2018, the London-based company also resorted to a massively discounted stock issue to shore up its finances.
Countrywide performed fairly downbeat in the stock market last year with an annual decline of roughly 25%. At the time of writing, the British property group has a market cap of £197.41 million.