Rightmove has rejected a £5.6 billion takeover bid from Rupert Murdoch’s REA Group, labeling the bid as ‘opportunistic’ and claiming it undervalues Britain’s largest online estate agent.
REA Group, the Australian property conglomerate controlled by Murdoch’s News Corp, has submitted an indicative cash and shares proposal valuing Rightmove at 705p per share – a 27% premium to the company’s current market valuation. Despite this, Rightmove’s board unanimously rejected the offer, with a statement to investors stating: “The board has carefully considered the proposal, together with its financial advisors, and concluded that it was entirely opportunistic and would undermine Rightmove and its future prospects fundamentally undervalued.”
Under the city’s takeover rules, REA now has until 5 p.m. September 30 to formalize or withdraw its offer.
REA Group, which has a market value of A$26 billion (£13 billion) and owns property brands such as realestate.com, first expressed interest in acquiring Rightmove last week. The announcement led to a 25% rise in Rightmove’s share price, taking its market value to £5.3 billion on Tuesday.
The proposed deal would see Rightmove shareholders own approximately 18.6% of the combined entity’s share capital, while retaining rights to an interim dividend of 3.7 pence per share. REA argued that their proposal provides “certainty of value” with a cash component and a significant premium, in addition to potential benefits from the future growth of the merged company. The cash portion of the deal would be financed through a combination of third-party debt and existing funds.
REA also plans to secure a secondary listing on the London Stock Exchange, with the aim of attracting a broader investor base interested in a global, diversified digital real estate platform.
Rightmove’s rejection comes amid a challenging period for the UK property market, with high mortgage rates dampening buyer enthusiasm. However, market activity is expected to improve as interest rates eventually decline.
The move is part of a broader strategy by the Murdoch family to diversify beyond traditional media businesses, as Rupert Murdoch hands over leadership to his eldest son, Lachlan. At 93, Rupert Murdoch is reportedly trying to change the terms of the family trust to give Lachlan sole control, a decision that has sparked dissension among his other children and set the stage for a legal battle in Nevada.