Online agent easyProperty is buying The Guild of Property Professionals plus Fine & Country in a deal – described as ‘game changing’ – said to be worth £33m deal which last night was updated as being worth £60m.
The deal, likely to cause shock-waves, is officially being described as a merger, or ‘reverse takeover’, rather than a purchase.
The deal is however backed by Toscafund Asset Management, which has already pumped money into easyProperty, which in March posted losses of almost £11m on a turnover of under £1m for the year to the end of last September.
Toscafund poured £14m into easyProperty at the end of 2015, and has now decided on further investment.
The business model of easyProperty is changing, and new management has been brought in from GPEA, parent company of both the Guild and Fine & Country. The easyProperty brand will remain the same, although we understand that the deal means that the franchise agreement originally struck between Robert Ellice and ‘easy’ has had to be renegotiated.
The new model means that easyProperty will evolve from being solely a business to consumer operator, to a provider of services to licensees.
The deal will allow the 5,000 Guild agents plus those in the Fine & Country network across the UK to offer additional fixed-price online sales and lettings packages alongside their traditional commission model.
It means that Fine & Country agent branches will, for example, be able to offer both their own luxury high street brand as well as acquire licences at £500 per month each, to access easyProperty’s fixed-price packages aimed at the volume residential market.
The deal is expected to complete at the end of this month.
The Guild was established 24 years ago. Its highly successful spin-off, Fine & Country, has taken off internationally since its launch in 2002, and now has almost 300 outlets in the UK and elsewhere.
easyProperty was founded by Robert Ellice, and operates using the name under licence from Sir Stelios Haji-Ioannou’s easyGroup. Ellice will now become commercial director.
The newly merged company, known as e-Prop Services plc – very similar to the existing company name registered at Companies House – will be headed by Jon Cooke, who has been appointed CEO.
He describes the merger as a game changer for the estate agency industry: “This deal allows our independent agents to offer more consumer choice with sales and lettings products catering to both the do-it-yourself and the do-it-for-me vendor and landlord preferences.
“We recognise the market requires and demands both online products and traditional methods. What I’d like to stress is this newly merged business is the convergence of traditional estate agency and online.
“Effectively we are providing independent agents the ability to compete with products targeting each consumer demographic.
“At the same time, licensees will have full autonomy and flexibility to not only benefit from upfront revenue streams but take advantage of potential lead-generation into their core brand.
“In the coming months we will be launching the new easyProperty website as well as a new national brand marketing campaign.”
Cooke, who headed up LSLi, the acquisition wing of LSL and was later estate agency director at the group, will retain his executive director positions with the Guild and Fine & Country.
His new role as e-Prop Services Plc CEO carries with it the responsibility of rolling out the new easyProperty platform across the industry.
Malcolm Lindley, Guild founder and Fine & Country co-founder, is appointed chairman of e-Prop Services.
He said: “Certainly the landscape of our industry is changing. Our clients require more choice, more flexibility, different ways of accessing our services, transparency and value.
“The strength of the ‘easy’ brand will provide the platform for us to defensively and aggressively continue to protect our independent agents’ market share.”
During the Guild’s recent Fit For The Future roadshows, more than 80% of attendees expressed an interest in a branded technology platform allowing them to offer a choice of services to their customers.
The Guild says it will be following up with another round of regional meetings in the coming weeks to present the new platform and customer proposition, and the commercial opportunities.
Yesterday evening, Cooke insisted that the deal was a merger, or ‘reverse takeover’, rather than an acquisition of the Fine & Country and Guild businesses.
He said that take-up of the easyProperty licences could be popular where agents in some areas are under pressure from online firms.
Cooke said he expects market share by online agents offering ‘self-service’ to grow to between 23% and 25% of the market.
Asked if the easyProperty brand could topple Purplebricks, he said that he expects there to be two brands in the market – similar to Coca Cola and Pepsi, and to Rightmove and Zoopla.
Cooke also acknowledged that while the industry might see the easyProperty brand as damaged (because of their latest accounts), consumers do not. He did criticise some earlier PR – including the enormously expensive launch party among the ‘dinosaurs’ at a London museum, and the ‘funeral march’ of high street agents in London.
Cooke said: “The reality is that the easy brand has 98% public recognition.”
Cooke would not go into details as to how founders of the Guild and Fine & Country may have benefited from the deal.
Online agent easyProperty set to seek more funding as it posts losses of almost £11m
The recent regional meetings mentioned a proposal but kept the wraps on the ‘brand’ involved. Tonights newsflash is exactly that – no communication from the Guild at all.
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So have I got this right…. its like Waitrose being able to pay a monthly fee to sell Tesco Value Bread?
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>>its like Waitrose being able to pay a monthly fee to sell Tesco Value Bread?
great and very apt comment!
Has the Guild’s Property Platform self-service offering taken off? Nobody I know signed up for it. I appreciate that this was launched 12 months ago and a lot has happened since but The Guild’s angle was “here’s something to keep in your back pocket in case you think you’ll lose an instruction to the purple boys”. If that wasn’t well received, how will this go down? It is something very different and much more serious – Guild agents will need to be heavily incentivised to take the new offering out of their back pocket a lot more often.
I’m still sure that offering self-service – even with a separate brand – would water down our brand. I wonder if Iain McKenzie would ever confirm this from his own Countrywide self-service experience?
We’ll try to stay like Waitrose and maybe dip our toes into up-front fees with viewings and negotiation as an extra. Difficult though. If a vendor talks about his bad moving experience in the pub, he’ll name us but forget to pass on the caveat that he went for our up-front, self service, no negotiation, no viewings deal.
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Very interesting as work for an existing guild member. They’ve been trying to punt round their own online platform for awhile but take up was tiny (as far as we could tell less than double digits!)
i imagine my employer will seriously review our membership now
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Ditto.
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This goes against everything the Guild stood for. We have already decided that we will be leaving the Guild – a shame as we were one of the first agents to support them. 🙁
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So, ‘easy’ is now dancing with the dinosaurs.
And The Guild and F&C have the opportunity to go relentlessly down-market.
So is it a merger made in heaven … or some other place?
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Was that a tremor that just shook the opening share price of a certain mauve coloured online agency?
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Sounds like a desperate last roll of the dice to me. Trying to find an angle within traditional agency because their online proposition has failed spectacularly. Not dissimilar to Emove’s recent decision to try to roll out their software platform to the traditional sector.
Interesting also that Ellice has fallen down the ranks to Commercial Director. Even money says he’ll be gone before the end of the year.
It’s embarrassing that so many supposed industry experts are rushing to hitch their wagon to a newly created sector that has yet to prove itself successful both in terms of its consumer proposition or profitability.
Every month that goes by we take on more property from those unsuspecting vendors that were fooled into believing that selling property is easy and who are now bitter at having spent a considerable sum of money without seeing anything in return.
As time goes by, this message will eventually get out and people will accept that selling property is very different to simply advertising property on the internet.
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£33m!!! Unbelievable. Would Harrods ever be interested in a ‘merger’ with The Pound Shop in order to appeal to the mass market. As a ‘Full Service’ agent, we ARE the mass market and online agents are the minority market. I have seen many changes in our industry over the years, like Prudential paying £400k per branch in 1988/89, Nationwide doing the same and selling their entire network some years later for £1. Don’t these people realise that Estate Agency is hard work and the public like dealing with most of us good agents that they can come and see, and that work all hours, and that still negotiate on their behalf and accompany viewings and still produce good looking brochures and and and….. Please next time, email me and I will take your £33m and show you some much better ideas of what you can do with it.
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Quite honestly unless there is more to it than I can see, it strikes me as a ridiculous merger.
Why anyone who is offering a Fine and Country brand would want to offer a bargain basement option alongside escapes me. Those agents in tough towns that feel they need this, need what exactly? Exchange and Mart advertising?
I don’t even see that easy had particularly good technology. I can’t believe I’m saying this but even that tw*t at Emoove would have been a better purchase.
Still we pretty much guessed it right that Easy and Ellice were dead in the water. This is purely their backers trying to salvage something.
The phrase good money after bad springs to mind however.
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Why anyone selling their house would want it associated with such a ‘budget’ brand. It cheapens the house and you would have to be mad to sell your house with that branding. Big mistake!
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You know when your mate gets married and you look at their partner and think
” This will never last”
Yep just thought that!
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An interesting marriage.
The very very experienced Mr Cooke and the big fund VCs behind Mr Ellice.
Will divorce follow.
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Good luck to Jon and Rob and their crews
Gut feel is with big vc funds and quality senior agency minds at the helm and a large established quality agency network of offices, suddenly Purple Bricks has a big problem.
If Easy Fine Guild open to more VCs it could dry up that ongoing purple pounds that has held PB up and built its presence fast.
Easy Guild & Fines challenge is now retaining the agents who carry crosses and garlic for when the budgets visit gone midnight.
The association with budget and a call centre may drive some quality offices away.
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Would love to know what Malcolm and son are getting out of the merger? I guess it is a case of selling out to the highest bidder. they won’t care if it eventually kills the brand. They can retire and watch the divorce in a few years.
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Wow, night of the living dead and I just slept through it. If you can’t beat them, buy them!
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Would the last member to leave the Guild after this News please kindly turn out the lights?
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As a guild member having this forced on me is a joke and will be moving to Hystreet ASAP. I’ve seen their product; it’s a lot a lot better and I won’t be growing another agents brand, just mine. They are new and untested but the demo showed an awesome system… Bye-bye guild…
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