Shares of Rightmove took a hit following the announcement, falling approximately 8.5% during Monday’s afternoon trading compared to the previous Friday’s close at 668.60 pence.
Future Opportunities and Takeover Rules
Although REA has backed down for now, the door remains open for future offers, either from REA with Rightmove’s consent or from a third-party suitor. REA had been pursuing Rightmove since late August, submitting four offers within a valuation range of £5.6 billion to £6.2 billion.
However, Rightmove’s management maintained that the proposed combination would not provide sufficient value for shareholders. REA argued that the deal would have given investors a stake in a “fast-growing, diversified, global leader” while pointing out that Rightmove’s stock performance has been stagnant for two years.
REA £6.2B Rightmove Bid : Industry Reactions
Russ Mould, investment director at AJ Bell, suggested REA may need to rethink its strategy to win over Rightmove’s board in the future. “They’re going to have to radically change the price and structure of the deal if they have any chance of succeeding,” Mould said, adding that the heightened takeover interest could position Rightmove favorably in the market, potentially attracting new investors.
