We would love to hear your thoughts about our site and services, please take our survey here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
I’m thinking the terms of the Tender look good. Am I missing something?
Looks like no step change in revenue from Surveying Services in Q4
https://www.mortgageintroducer.com/countrywide-to-continue-as-normal-despite-second-lockdown/
Proposed board changes
This is a takeover in all but name by the backdoor on the cheap by Alchemy
1. Carl Leaver, Chairman
2. Himanshu Raja, Chief Financial Officer
3. Paul Creffield, Group Managing Director
4. Ian Cash, Alchemy nominated non-executive director
5. Ian Neill, Alchemy nominated non-executive director
Countrywide prospectus issued whilst Hoskings increase their holdings to 14% . If they throw their lot in with Catalist the 25% needed is almost home and hosed to repel Alchemy's offer
Yet another raft of abortive costs for this set of BODS at CWD?
Whatprice
Yes CWD never learned anything from the mistakes by the Pru, banks/building societies and out paying out fat sums to small businesses which is either golden goodbyes to senior partners and for other equity holders golden handcuffs until they can start up as you say next door cherry picking all the clients
Making the cardinal error of not paying out the majority of the price in paper ensuring they retain some skin and incntivised to remain
My ex partners were one of the last small practices to be bought out by the Pru ,hang around for about 2 years drawing a salary during a recession sat on their hands and spent most of the time spending their fat cheque on holiday homes
Ran the office down
Said we are leaving but will buy back for 5% of the price received 2 years earlier .Pru did the deal with them and they told me it actually hadn't cost them anything as they had held back a few fee accounts !
Amazing how quickly the office picked up back to full steam shortly afterwards!
Having said all that there are some good people amongst the CWD deserving of a place on the BODS
The time served Lesley Cairns for example who heads up Hamptons for example
https://www.linkedin.com/in/lesley-cairns-62253727?originalSubdomain=uk
Unfortunately the quite ridiculous spending spree on buying up mainly Lettings books and whole Lettings businesses has backfired on them pretty spectacularly when at the end of the agreed lock out period ( normally 2 years ) the very people who couldn't believe their luck with the amount of cash ( not shares ) thrown at them by the muppets at CWD simply opened in in some cases around the corner from their previous location and quietly took back the clients worth having ( long term investors ) and left the rest. The reality I'd that the majority of these businesses were small independent family run and no one therefore with the relavent experience needed to head up the CWD behemoth. The truth is a little more simple in my opinion in that the real talent had already seen the writing on the wall during the Platt/Tyrer debacle and either ran out the door in horror or took their payoff and ran for the hills. Sadly only yes men/women left so good luck to whoever is given the poison chalice they will need plenty of it.
Long has already departed and Creffield is retirement age in any event. They have been joined by another senior exec Chapman COO who is also going
You would have thought that having shelled out tens of millions to buy in talent there would be individuals amongst the brands deserving of a place on the BODS
Somebody who actually knows the business of running an estate agents
I am sure that would be the approach of Patterson
Issue is if the deal doesn't go through are we left with Long and Creffield!On the current business the o/s pipeline must be capable of producing very good profits between now and end Q1 .Plenty of time to sort it all out and reduce costs on no hopers-and recruit quality talent ..... if headhunters get out and find the right people.NOT CWD headhunters/ the woeful HR department and lets recruit seasoned estate agents not some other industry that hasn't got a clue or the pre Platt mob at CWD. This business has to move forwards-fresh and with purpose.
Tender offer now received and massive dilution for those left behind
This was buried in the small print
"Under the Listing Rules, the Listing Transfer requires the Company to obtain the prior approval of a resolution for such transfer from a majority of not less than 75 per cent. of the votes attaching to the Ordinary Shares voted on the resolution. Accordingly, the Listing Transfer Resolution will be proposed as a special resolution at the General Meeting."
This is the current background Be interested to hear from posters who think that this is an unwarranted and excessive capital raise gifting control to a vulture fund is a good idea .
Recommended by a set of BODS who have made one bad decision after another
https://propertyindustryeye.com/mortgage-approvals-hit-13-year-high-as-uk-housing-market-booms/
Hoskings have made their investment philosophy clear now holding 13% Catalist with 10% "
All it needs is one of the small funds or a number of small investors to scupper the deal
Just in case a sense of apathy has bedded in it's worth noting that Alchemy need over 75% of shareholders to shoehorn their deal through
That has not been made clear.
They are not over the line so it's definitely worth registering a firm No"if you are so inclined
Invesco now reduced their holding to under 5% .I wonder who has picked them up?
The SP robust yesterday
Yes Oaktree are "distressed" company buyers who bought CWD's "debt "and hence the company when the market was on its knees , Listed at the first available opportunity dumping a shedful of shares and booking a profit .
They teamed up with Alchemy last time time around the houses with a pincer movement .
2009, distressed debt funds made their presence known in Europe as the downturn started to take effect. Countrywide, the UK’s largest estate agency, was one of the first in Europe since the credit crisis to be taken over by one of these funds."
https://www.ft.com/content/d9963e4e-14a9-11df-9ea1-00144feab49a
In early 2009, after some negotiations, Apollo – which had also bought the company’s bonds – and Oaktree sealed a deal to recapitalise the company.
Along with funds Polygon and Alchemy Special Opportunities, they agreed to inject £110m of new money, upped from an initial offer of £75m, in exchange for writing down the company’s debt by 75 per cent.
The merry dance about to begin again .The only difference is this time sales are at record levels and the debt is not distressed despite the best efforts of the BODS and Alchemy to convince small shareholders it is
Didn't Oaktree make a packet once before from CWD taking it public.
Here is the leaderboard
What are the chances of giving Alchemy a run for their money ?
Oaktree Capital Management LP 5,990,726 18.3%
Hosking Partners LLP 3,975,204 12.1%
Real Estate Partners 1 LLP 3,435,983 10.5%
Brandes Investment Partners LP 3,100,928 9.46%
Jupiter Asset Management Ltd. 1,634,875 4.99%
Fidelity Management & Research Co. LLC 1,634,754 4.99%
Schroder Investment Management Ltd. 1,504,612 4.59%
Hargreaves Lansdown Asset Management Ltd. 1,380,007 4.21%
Hargreaves Lansdown Stockbrokers Ltd. 1,313,000 4.01%
Ninety One UK Ltd. 657,082 2.01%
https://www.estateagenttoday.co.uk/breaking-news/2020/10/busiest-ever-autumn-buyers-up-prices-up-delays-up-supply-up
"Zoopla estimates there are currently 418,000 sales in the pipeline yet to complete; these sales are worth £112 billion. Sales agreed hit an annual high in August, which showed a 62 per cent year-on-year uplift.
The market has slowed since then but only slightly - sales agreed are currently running at a 53 per cent year-on-year uplift this month in comparison to October 2019. "
This is the background this inept set of BODS are suggesting shareholders reach for the Alchemy lifeboat
Jeremy Hoskings an investor who has been around the block .He outlined his investment philosophy in an interview
"Marathon co-founder investor tells FN the best time to invest in a company is when it’s out of fashion and starved of capital"
"Hosking points out you can buy cheaply near a cyclical low and put yourself in a position to benefit further as sentiment improves. The time to avoid companies is when they are highly priced, attracting a flood of capital and riding for a fall!"
“It is a good idea to back companies where managements are incentivised to do the right thing by owning a decent chunk of equity.!
Hoskings Interesting player in the mix Jeremy Hoskings has been around the block and here is a sample of his investment philosophy
https://www.fnlondon.com/articles/jeremy-hosking-on-the-power-of-ideas-in-asset-management-20160721
"Marathon co-founder investor tells FN the best time to invest in a company is when it’s out of fashion and starved of capital"
and what would probably be a good move for CWD giving some senior execs some skin in the game"
"This suggests it is a good idea to back companies where managements are incentivised to do the right thing by owning a decent chunk of equity."
"Hosking points out you can buy cheaply near a cyclical low and put yourself in a position to benefit further as sentiment improves. The time to avoid companies is when they are highly priced, attracting a flood of capital and riding for a fall."
Hoskings flexing their muscles increasing their shareholdings.Reminding everyone they will have a say in proceedings
It's not all over yet
I can categorically say that the market bounce post lockdown has surprised everyone including most agents. Right across both the second-hand and new Build Markets and in turn FS/legal etc etc
Pipelines should be way up in every agent in the land and if not something has gone horribly wrong. The larger the agent the bigger the upside in terms of market bounce.
North an South poles
https://www.estateagenttoday.co.uk/breaking-news/2020/10/exclusive--many-countrywide-branches-reported-shut-permanently
Alcehemy's PR machine in full overdrive flagging up some selective pruning of a few underperforming branches in a negative light whilst failing to flag up those who have more than compensated with 40% increase in sales
Here is the reality for many of the brands
https://propertyindustryeye.com/kfh-launch-new-recruitment-drive/
"KFH, like many agencies, had a busy period between July and September 2020.
The company’s sales division recorded an 80% increase in valuation requests and a 102% increase in instructions year-on-year with sales doubling during this time.
Lisa Mackenzie, sales director at KFH, commented: “It has been a challenging year for the industry and we have had to weather many storms. The market was in much better shape than we anticipated, and we had a virtual queue of people requesting valuations and viewings as soon as the stamp duty holiday was introduced.
“This shows that we are a trusted agent for those looking to buy and sell across London. These market levels do not come around very often, and the successes enjoyed by our sales teams has had a ripple effect on activity across all of our business divisions.”
In the RNS , Alchemy have already unwittingly flagged their intention with the purchase
"Furthermore, the lenders have indicated that they would not be supportive of a disposal strategy as a means by which to deleverage the Group's balance sheet."
In other words ,once we have got that monkey off our backs we are free to slash and burn and claim all the prizes
I think many posters here would be happy to chip in at 150p-160p to raise £10-£15m
I should imagine Long & Creffield's packages will be generous. Alchemy must be delighted in the way this has been spun and delivered up
The BODS arrogantly spurned Paterson the only individual with a proven track of performance in the game
Timing immaculate just before the expiry of H2 which is going to be very robust
This set of BODS could not have been any worse for shareholders
No way will Alchemy leave it in in one piece.
Surely long and creffield wont walk away with a payoff..........surely -After us smaller shareholders have been so royally shafted
No wonder CWD has been driven into the ground where the BODS have a warped sense of arithmetic
According to the pitch by Alchemy net debt at Sept 30th was £55.6 m With sales and surveys still red hot should imagine this month already made some inroads into that .
I wonder what Long has trousered as a golden goodbye?
"Net debt(2) was £55.6 million at 30 September 2020 against total available facilities of £135 million. The underlying net debt after adjusting for agreed time to pay PAYE/NI and VAT deferrals was £90.2 million."
We are also advised that the company enjoys facilities of £135m which is up for renewal next year in Sept 2021
They then go onto say that discussions with their banks reveal they want to reduce that burden by £50m to £85m where the worst case scenario says they will be £5.2m short
That currently still leaves a decent headroom of £35m today , worst case scenario -£5.2m They then suggest we stump up £8m in fees to raise £90m unecessarily when say £15-£20m would do
The only justification seemingly to gift control to Alchemy at the expense of existing shareholders
Furthermore with trade currently at records levels when the rest of the country is on its backside due to pandemic and a new set of BODS you would have thought that any bank would be more supportive rather than turn to lenders of last resort
"Whilst the business returned to profitable growth in 2019 (based on a 16 per cent. year-on-year increase in adjusted EBITDA (pre-IFRS 16)), the Group is at a critical inflection point "
Shareholders treated like mushrooms
You would have never have guessed it from the recent doom and gloom RNS
https://www.financialreporter.co.uk/in-the-spotlight/in-the-spotlight-with-matthew-cumber-countrywide.html
"We spoke to Matthew Cumber, managing director of Countrywide Surveying Services, about how the firm is handling RECORD monthly volume levels and how he sees the shape of surveying in 2021."