Alchemy rules out new Countrywide bid as Connells takeover moves forward

Private equity firm Alchemy has confirmed that it will no longer make an offer for Countrywide PLC, following a couple of bids for the estate agency group.

Alchemy had secured the support of almost 45% of Countrywide’s shareholders for its proposed offer for the company last month.

The private equity firm confirmed its proposed offering of 250p for each of the estate agency company’s shares and a £70m capital raising that would have enabled other shareholders to keep stakes in the company.

Alchemy secured letters of intent from shareholders holding a total of 44.8% of Countrywide’s share capital.

Alchemy said under its proposal Countrywide’s existing shareholders would be able to sell their shares at 250p a share to Alchemy.

It would also have included a recapitalisation of £70m fully underwritten by Alchemy. This would have comprised a placing of approximately 15.6m shares to Alchemy at 225p each, generating gross proceeds of £35m, and an open offer of 35m shares at 100p each.

Shareholders other than Alchemy would be permitted to make excess applications once Alchemy had achieved a 50.1% shareholding.

Under Alchemy’s proposal Countrywide would have kept a standard listing on the London Stock Exchange unless at least 75% of shareholders voted otherwise.

Despite the support Alchemy secured from a number of shareholders, it was simply not enough to get a deal agreed.

Last month, Countrywide and Connells announced that they had reached agreement on the terms of a recommended cash offer by Connells for the group.

Countrywide and Connells have now published the scheme document for the takeover.

Countrywide has scheduled the court and general meetings for 15 February, where its shareholders will vote on the proposed takeover.

The scheme is expected to become effective by the end of the first quarter of 2021, but still has a long stop date of 30 June.

Alchemy Partners issued the following statement regarding to Countrywide plc: “Further to previous announcements made in relation to a possible offer by Alchemy for Countrywide plc (“Countrywide”), Alchemy today [Friday 22nd January 2021] confirms that it does not intend to make an offer for the entire issued and to be issued share capital of Countrywide pursuant to Rule 2.7 of the City Code.  Consequently, Alchemy and any person acting in concert with it is, except with the consent of the Panel on Takeovers and Mergers (the “Panel”), bound by the restrictions contained in Rule 2.8 of the City Code.

“Under Note 2 on Rule 2.8 of the City Code, Alchemy and any person acting in concert with it reserves the right to set aside the restrictions in Rule 2.8 within six months following the date of this announcement in the following circumstances: (i) in the event that the offer by Connells Limited is withdrawn or lapses, with the agreement of the board of directors of Countrywide; (ii) following an announcement of a firm intention to make an offer by a third party; (iii) if Countrywide announces a “whitewash” proposal (see Note 1 on the Notes on Dispensations from Rule 9 of the City Code) or a reverse takeover (as defined in the City Code); or (iv) if the Panel determines there has been a material change of circumstances.”



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  1. Hillofwad71

    What has now become clear is that Connells had been in discussions with Countrywide for nearly a year having signed a confidentiality  agreement on the 3rd March  and  then  a further  clean sheet agreement on the 12th

    Appeared on the scene  no doubt after the failed merger with LSL in February

    In full due diligence mode from then on  looking under the bonnet

    Shortly after signing those agreements the pandemic kicked in so no doubt halted proceedings somewhat


    However both Connells & CWD emerged from lockdown  in May/June running ,.staff costs mitigated  by furloughing  and with stamp duty savings in July .it was flying

    Connells would have had all the numbers so a privileged position


    The share price had plummeted to 40p in April it was 250p when Connells signed the agreement in March ,65p in June and still under  150 p by the end of July i

    Why on earth didn’t  Connells strike in August with all the information gathered? Others had  seen the opportunity Paterson  & Hoskings recognising it was undervalued and had taken positions


    Maybe the Skipton were reticent due to the pandemic .However  they would have been fully aware that  CWD were under  pressure

    from the  banks  and would jump into bed with the 1st girl who offered .

    Competition was on hand if it wasn’t going to be Alchemy it would have been A N Other.

    If they had offered say 260 p  in August which was below the share price in Feb when 1st interested it was 310p mid February

    shareholders  would have bitten their hand off


    Now been forced to pay  395p a share £130m for the company  over  £40m more  than they could have secured in August

  2. majortom1

    Whilst I admire the bravado here and in normal times what would be a great deal I cant help but think its still a huge risk with what is ultimately Skipton members money. If I were in the same position Id probably take the gamble. With new variants now out there and questions over if the new vaccines will actually work its an unknown world and it was ones own money caution surely would prevail here right now. Plus Skipton may be encouraged to pay back Gov support monies-if so ,by way of Connells, they could be into many millions more and as we know their profits have been falling considerably  year on year for the last 3 I believe.

    Bottom line-Connells naturally want the deal to get the profit line moving up but I’m surprised a cautious mutual such as Skipton do at this point in time.

    What % of mortgage surveying will fall under the group if the deal is successful.

    I hope the deal happens-fortune favours the brave-well, some of the time!……….and this is a very very brave move.

    1. Joseph60

      Another negative view from this individual about Connells.  I did ask in a comment some weeks ago, why he was always negative about anything Connells Group did, but had no reply.  No doubt eye readers will draw their own conclusions.

      1. majortom1

        If you actually read my comment it says if it wasn’t my money and if I had a similar  opportunity (and if I felt brave) Id do the same thing. I also state I hope the deals gets done -so hardly negative Josepth60.

        Sliding Profits at Connells are just a matter of fact are they not-if not then please correct me as I have it wrong.

        Skipton is a mutual and naturally risk adverse. I am just surprised that’s all.

        Give my regards to Chips-I miss him.

  3. juniorneg

    I have said it before, offering £135m for a company and not repaying furlough money is completely immoral.  Any company big or small who looks to benefit out of the public purse in such a way during a pandemic needs to reconsider their values.


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