Australian company REA Group's bid to acquire portal site Rightmove has taken a new turn after the group increased its takeover bid by nearly 10%, the company's CEO (pictured) has revealed.
REA Group has increased its offer price for Rightmove shares to £7.70 per share, valuing the company at £6.1 billion, a 39% premium to Rightmove's current share price of £5.56. 
The proposal, made yesterday but disclosed to the city this morning, is a significant improvement over the proposal made two weeks ago but rejected by Rightmove's board.
REA Group has a major challenge in having to convince both its own shareholders and those of Rightmove that the deal is “fair value”, but REA Group CEO Owen Wilson is apparently unhappy that the Rightmove board has “not responded” to the proposal, which he believes is a “thoroughly opportunistic” takeover bid.
In a statement, REA Group said Rightmove's share price had “lacked sustained upward momentum for two years”.
basis
“REA's approach is based on what it believes to be a strong strategic rationale for the proposed transaction and REA believes now is the perfect opportunity to support and accelerate Rightmove's strategic objectives for the benefit of all stakeholders.”
“REA's expertise will help Rightmove maintain its market-leading position and de-risk its strategic execution given increasing competition and investment in the market.”
Wilson added: “We are confident that combining our world-class expertise and technology with the compelling Rightmove business will create an even more enhanced experience for property agents, buyers and sellers.”
competition
“We live in an increasingly competitive world and this proposed transaction would bring together two highly complementary digital real estate businesses in an effort to invest and grow. We have today increased our offer to an estimated 770 pence, which provides immediate value certainty in cash whilst providing Rightmove shareholders with increased opportunities in our core digital real estate and adjacent sectors where we have significant expertise.”
“We are genuinely disappointed with the lack of engagement from the Rightmove board and strongly encourage the Rightmove board to get involved.”
Right move response
Rightmove chairman Andrew Fisher said: “Rightmove is a great company with a very clear strategy, a consistent track record and a strong management team. The board is confident in the company's short and long-term prospects and believes there is a long way to go for continued shareholder value creation.”
“Based on the implied value and structure of REA's first and second non-binding proposals, we determined that these proposals were uncertain, highly opportunistic and unattractive, and therefore the Board unanimously rejected them.”
“The board will continue to act on behalf of shareholders and will respond to the latest proposals accordingly.”
Learn more about the acquisition.
