OnTheMarket Takeover: CoStar deal backed by key independent advisor

The prominent independent advisor ISS - Institutional Shareholder Services - has publicly backed the OnTheMarket board and is recommending shareholders vote ‘for’ the planned acquisition by CoStar UK.

OTM is holding a Court and General Meeting next week at which a decision will be taken on the deal.

ISS is an influential player in the world of corporate governance and typically gives its views on how similar issues affecting pension funds, investment managers, mutual funds and other institutional funds.

The OTM board has already unanimously backed the £99m CoStar bid. Its 110p per share offer price gives a hefty 56 per cent premium on the last close price.

Earlier this month Brett Stone, an investor who offered to invest more than £50m in OnTheMarket last year, wrote letters claiming that OnTheMarket's takeover by CoStar was "not in the UK's national interest".

However in a statement at the weekend OnTheMarket’s board reiterated its unanimous recommendation, stating it is an attractive valuation for shareholders and confirming that it would help “create the number one agent-friendly UK residential property portal and a genuine disruptor to the established market leaders”.

And it adds: “The level of investment CoStar intends to deploy represents a material acceleration of OnTheMarket’s existing strategy in this regard.

“CoStar will invest to grow traffic to OnTheMarket’s portal, for the benefit of OnTheMarket’s agent clients.”