With less than a week to go before the Court Meeting and the General Meeting which will decide the fate of OnTheMarket, there’s been another boost for the portal’s leadership.
The OTM board advocates a sale to global property datas group CoStar, which has already pledged to spend £46.5m on sales and marketing in the first full year following the takeover, which is six times OTM’s current spend and over three times the current annual media spend of Rightmove.
Now another independent proxy adviser has backed the OTM leadership.
Glass Lewis recommends that OnTheMarket shareholders vote ‘for’ the acquisition by CoStar, supporting the portal board's unanimous recommendation.
This follows a similar recommendation by another prominent independent advisor, ISS - Institutional Shareholder Services.
Meanwhile the OTM board has reiterated its unanimous recommendation to shareholders, citing the following reasons:
- Attractive valuation for OnTheMarket Shareholders at 110 pence per share, which is a 56 per cent premium to the closing price before the offer was announced, and a 94 per cent premium to the three-month volume weighted average price before the offer was announced;
- CoStar is seeking to create the number one agent-friendly UK residential property portal and a genuine disruptor to the established market leaders. The level of investment CoStar intends to deploy represents a material acceleration of OnTheMarket's existing strategy in this regard:
- CoStar is committed to maintaining fair and sustainable pricing for agents and intends to continue charging agents a small proportion of Rightmove's current charges;
- CoStar will invest to grow traffic to OnTheMarket's portal, for the benefit of OnTheMarket's agent clients;
- CoStar expects that the senior management and employees of OnTheMarket will continue to contribute to OnTheMarket's success and does not intend to initiate any material headcount reductions.
The decision will be reached by shareholders in London during next Monday morning.
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Neither Glass Lewis nor ISS are Estate Agents on whom OTM rely. This article has presumably been placed by OTM or their PR. This sale brings little to agents other than higher fees. Whatever 'spin' CoStar may try to place, there is no doubt that a hard nosed, agressive American company will want its pound of flesh. Be warned!
I always thought the main selling point of OTM was that it was agent-owned. If it is sold, it becomes just another portal.
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