Rightmove has said it will “carefully consider” a new £6.1bn bid from Rupert Murdoch’s property website business as the two sides move a step closer to a deal.
REA Group, which is majority-owned by the media tycoon’s News Corp, has confirmed it has made a third takeover approach for Rightmove worth £6.1bn.
The new proposal is worth 770p a share, which compares to previous bids worth 705p and nearly 750p per share, which valued Rightmove at £5.6bn and £5.9bn, respectively.
It comes after REA first tabled a possible offer in early September, valuing Rightmove at £5.6bn.
The continued pursuit comes as News Corp seeks to further diversify its business beyond media as patriarch Rupert Murdoch hands over the reins to his eldest son, Lachlan.
Rightmove rejected the initial approach as “opportunistic” and some investors have also spoken out to criticise the structure of the offer, which is based on a mix of cash and shares in the combined group.
However, it said today that its board “will carefully consider” the increased proposal.
Andrew Fisher, Rightmove chairman said: “Rightmove is an exceptional company with a very clear strategy, a consistent track record of delivery and a strong management team.
“The board is confident in the company’s short and long-term prospects, and sees a long runway for continued shareholder value creation.
“Based on the implied value and structure of REA’s first and second indicative non-binding proposals, we considered these proposals to be uncertain, highly opportunistic and unattractive. Accordingly, the board unanimously rejected them.
“The board will continue to act on behalf of our shareholders and respond to the most recent proposal in due course.”
Rightmove shares rose 2.8pc to the top of the FTSE 100 after the third offer emerged.
REA said it was “genuinely disappointed” that Rightmove’s board has not yet come to the table to talk, with its latest offer worth 341p in cash and 0.0422 new REA shares for each Rightmove ordinary share.
Owen Wilson, REA’s chief executive said: “We live in a world of intensifying competition and this proposed transaction would bring together two highly complementary digital property businesses for investment and growth.”
He added that the cash-and-shares proposal “provides a combination of immediate value certainty in cash and at the same time gives Rightmove shareholders an increasing opportunity in core digital property and adjacencies where we have much expertise”.
“We are genuinely disappointed at the lack of engagement by Rightmove’s board and we strongly encourage the Rightmove board to engage,” he added.
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