City analysts say the Australian portal trying to buy Rightmove would need to increase its bid to more than £7 billion for the deal to succeed.
Rightmove's board unanimously rejected a £5.6 billion takeover bid by Australian portal owner REA Group, giving REA until September 30 to make another bid.
The board argues that the proposal was “unsolicited” and too low, underestimating the value of the business. 
Opportunistic
REA is Australia's largest portal and is owned by Rupert Murdoch's News Corporation.
A Rightmove statement said the company had received “an unsolicited, non-binding and highly conditional proposal from REA for a potential cash and shares takeover bid”.
“The board has carefully considered this proposal together with its financial advisers and has concluded that it is entirely opportunistic and fundamentally undervalues Rightmove and its future prospects.”
Very small premium
The offer represented a 27% premium per share, but this would need to be increased significantly for Rightmove to accept, according to Panmure Liberalum analyst Sean Kiely (main picture).
“I think Rightmove was right to reject this because it's a very small premium on a restrained valuation compared to what I think it's worth,” he said.
Kiely told the Daily Telegraph that a 60% premium would be needed for a deal to go through, which would value Rightmove at around £7.1bn.
A phenomenal rise
Since news of the potential takeover deal broke last week, Rightmove's shares have soared by 27% in one day and remain 26% higher than they were a month ago.
Under the terms of REA's proposal, Rightmove shareholders would hold around 18.6% of the shares in the combined group.
