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Countrywide set to raise funds while Foxtons hints

30 March 2009
Written by Rosalind Renshaw

Debt-laden Countrywide has won court approval for meetings of shareholders to vote on the raising of extra money for the estate agency group.

Documentation for a draft scheme has been lodged with the High Court of Justice in England and Wales, and the Grand Court of the Cayman Islands. Meetings will be held on April 28.

The proposed injection of extra funds would write off debts and give the UK’s largest estate agency firm working capital.

Countrywide was acquired by US private capital group Apollo in spring 2007, shortly before the downturn savaged the housing market. It paid around £1bn.

Meanwhile, Foxtons – also bought by an American private equity firm at much the same time – may also need a cash injection.

Acquired by BC Partners for £360m, the new owners have already conceded – in January this year – that they made a ‘wrong call’.

Last week, BC Partners’ managing partner Andrew Newington told Reuters that sales volumes had fallen 75% from the market peak.

He apparently claimed:  “Foxtons is trading very profitably, but not in line with initial expectations.”
 
However, he went on to admit that banking covenants had now been breached, and said that unless there was a quick recovery in the housing market, the business might need additional support.

Comments

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    Would you put money into these companies???

    • 30 March 2009 18:49 PM
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    "...and the Grand Court of the Cayman Islands." Says it all really. Why do we all suffer obscene levels of taxation, but yet our bone brained government let inefficient corporations get away with paying little, if any. Maybe MPs will start claiming their expenses from Liechenstein?

    • 30 March 2009 17:58 PM
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    Just wish Foxtons would hurry up and go under, it's their constant over valuations over the pas five years that have artificially inflated market prices in London. How's this for a cheek... they had a meeting with e-serve and threatend to ban them from valuing any of thier properties unless they agreed with the agreed sale figure.. regardless of have far over actual market value.... The London housing market will be a better and more stable place to opertae once they've gone.

    • 30 March 2009 12:46 PM
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    FOXTONS GRAFFITTI - ie the writings on the wall!

    • 30 March 2009 12:15 PM
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    About time those damn Yanks got some of their own medicine. 'What goes around comes around'.

    • 30 March 2009 11:36 AM
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    Obviously Foxtons are struggling. So, who is going to be so kind and lend them money I ask?? In this game, your worth is according to the market...Erm how good is the market?..mmm!!! What's that Sinatra tune? And now......

    • 30 March 2009 11:30 AM
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    2009 will be the Year of the Independents! This clearly demonstrates that Corporates are struggling through lack of cash. If there are few sales who will pay the wages and the Rightmove bill?

    • 30 March 2009 11:28 AM
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    "Foxtons is trading very profitably" ... "may also need a cash injection" Make your mind up Foxtons. You are are either making a profit which you can reinvest into the Company, or you are making a loss and need money to stay afloat.

    • 30 March 2009 11:22 AM
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