The United Kingdom’s largest real estate portal decided it would be the wrong move to accept a takeover offer from Rupert Murdoch’s REA Group.
Rightmove turned down a $7.3 billion bid from the subsidiary of Murdoch’s News Corp., Reuters reported. Representatives of the listings portal said the cash-and-stock bid “fundamentally undervalued Rightmove and its future prospects.”
Rightmove’s board unanimously rejected the bid. Upon news of the failed takeover, shares of Australia-based REA fell 2.5 percent.
While Murdoch is retreating with his tail between his legs, there’s still a chance a deal could be revived. Analysts said REA could increase the cash — likely requiring a capital raise — or go around the Rightmove board and take an offer directly to shareholders.
The Realtor.com owner revealed a week ago that it was interested in acquiring Rightmove without revealing how much it would be willing to pony up to make a deal happen. As of last Tuesday, the market cap of Rightmove was $7.1 billion.
British law dictates that REA has until Sept. 30 to make something happen with Rightmove.
REA is a big player in the portal space, operating brands in Australia, Asia and North America, though this would have been its first known foray into Europe. Some of the entities operating under the REA umbrella include Simpology in Australia, PropertyGuru in Asia and Realtor.com in North America.
One of REA’s top rivals, Andy Florance’s CoStar Group, recently made a move in Europe and acquired Rightmove competitor OnTheMarket for $126 million.
Last year, CoStar looked at acquiring Move, Inc., the immediate parent company of Realtor.com. By February, however, the potential $3 billion acquisition fell apart.
Both CoStar and Realtor.com are stuck chasing Zillow in terms of market share of monthly user visits, but the latter’s diminished presence outside of North America provides an opportunity for global players to seize ground.
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