Published: May 17, 2023 at 4:33 a.m. ET
By Joe Hoppe
Shares in Purplebricks fell Wednesday after the company said it has conditionally agreed to sell substantially all of its business and assets to Strike for a nominal consideration of one pound ($1.25) and the assumption of its liabilities.
Shares at 0830 GMT were down 0.5 pence, or 38%, at 0.82 pence.
The…
By Joe Hoppe
Shares in Purplebricks fell Wednesday after the company said it has conditionally agreed to sell substantially all of its business and assets to Strike for a nominal consideration of one pound ($1.25) and the assumption of its liabilities.
Shares at 0830 GMT were down 0.5 pence, or 38%, at 0.82 pence.
The online estate agent said that on completion, the sale will result in a cash balance of up to GBP5.5 million being retained, with the intention that net cash proceeds after deducting certain costs will be distributed to shareholders.
The proposed sale is expected to make a small return to shareholders and preserve the business and brand, Purplebricks said. The takeover is conditional on shareholder approval which will be sought at a meeting on June 2, and the board has unanimously recommended that shareholders approve.
The company is also seeking shareholder approval to cancel its share trading on London’s AIM market following completion. Purplebricks then intends to reregister as a private company and change its name to Bricks Newco.
Chief Executive Officer Helena Marston will resign from her role on completion of the sale, the company said. With the exception of Chief Financial Officer Dominique Highfield, the rest of the board plans to step down following cancellation of shares. All other employees will transfer to Strike, though headcount reductions are expected short term.
Purplebricks said its strategic review has now been completed and it has terminated its formal sales process.
Strike had said on May 10 that it won’t make an offer for Purplebricks, though it remains in talks with the board regarding a possible purchase of the business and assets.
Purplebricks put itself up for sale on Feb. 17, simultaneously cutting its fiscal 2023 guidance. It said at the time that the company’s brand and business has significant value, but the potential of the group might be better realized under an alternative ownership structure.
It said on March 1 that it had received several credible expressions of acquisition interest.
Write to Joe Hoppe at [email protected]