Foxtons has appointed merger and acquisition bankers from Rothschild to work alongside its brokers Deutsche Numis and Singer Capital Market amid increasing pressure from shareholders to sell itself for £160m by the end of this year.
The move, reported by The Sunday Times yesterday, comes after its largest shareholder publicly called on the board of the estate agency group to find a purchaser.
Canadian investor Converium Capital, which owns about 5.3% of the business, and UK-based Milkwood Capital, which owns 5%, have both said they want Foxtons to find a buyer for the business.
Rhys Summerton, who runs Milkwood Capital, said: “We would like to see the company, which is a unique asset, sold this year.”
Two years ago, Rothschild advised on the sale of Leaders Romans Group to US-based private equity investor Platinum Equity.
In May 2022, Converium Capital also issued a letter to the board of Foxtons suggesting a sale of the business could yield a price up to 200% above its share price.
“The combination of poor operating performance and poor capital allocation has, unsurprisingly, resulted in poor share price performance,” the firm said at the time.
“Shareholders have lost more than £650m, or 87%, of their investment over the last eight and a half years.”
At the time of Foxtons’ IPO in September 2013, the company had a market value of £753m. Today the firm has a market capitalization of around £156.67m.
It has posted losses every year since 2017 and 2021 due to a dwindling number of housing sales in London.
However, its letting business has traded strongly as rents in the capital have risen in recent years.
A trading update published by the firm in March showed profit before tax slid 34% to £7.9m in the year to December 2023.
A spokesperson for Foxtons said: “Foxtons Group has a retained financial adviser. Rothschilds is the group’s financial adviser alongside Deutsche Numis, which is also the group’s joint corporate broker together with Singer Capital Markets.”
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