The growing anger of some OnTheMarket member agents about the portal’s parent company proposal to float on the London Stock Exchange has reached the national press.
The Daily Telegraph says the Agents’ Mutual float proposal - revealed last month and described by the newspaper as likely to “trigger a £20m windfall for its chief executive” Ian Springett - has led to a row within the website’s 2,700 member agents.
In a well-informed piece, the Telegraph says “opposition to the float is growing among some of its members, particularly those in smaller agencies with few branches.”
It cites the proposal that Springett’s 3.9m shares would be worth £20m if the portal’s parent company achieved the stock market valuation it is seeking - £200m to £250m.
The piece quotes extensively from the widely-circulated newsletter and campaign started by Graeme Lumsden, a long-standing OnTheMarket Gold member, who has in his newsletter described the portal’s performance to date as “lacklustre”.
The Telegraph quotes Lumsden saying: “My vote ‘no’ is really a plea to vote [for] change with the sincere hope that the chief executive and board will begin a real dialogue with the current membership to find the best proposal that the members can resoundingly support.”
The newspaper also says some agents have raised concerns that the flotation proposal - which requires 75 per cent of the members who vote to back it, at a members’ meeting next week - is being pushed through at the height of summer.
Not mentioned in the article, but raised with Estate Agent Today by OnTheMarket member agents who wished to remain anonymous, was that certain members of the Agents’ Mutual management team would get 4.8m shares as part of an incentive strategy.
On Sunday, the OnTheMarket press office issued a statement disputing a figure used in the print version of Daily Telegraph article and insisting OTM’s strategy was to issue equity to “further agents” to attract them to join.
“All agent and management shares will not be able to be sold for five years (save that 10 per cent can be sold after 12 months and another 10 per cent after 24 months). Only if the strategy succeeds will any shareholder agent or management shareholder realise any gains” the statement says.
Meanwhile this week sees a number of key developments for the float proposal.
Those dissident agents in dispute with OnTheMarket are believed to have a deadline of 10am on August 31 - Thursday - by which to return their proxy votes for or against the proposal. Proxy voters not in breach of their contracts have until 10am next Monday, September 4. The members’ meeting is being held on September 6.
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Just one point about this control issue, apparently new investors and the board will 'only' own 37% of the company, itself enough to give virtual control of a listed company. However the new shares reserved for new agents are likely reserved for the corporates if they join for free. As I said in my recent piece this will create a grouping of Investors, corporates and the board whose interests are pretty well aligned, make money by milking smaller agents.
Morning Simon ..... I am sure people can make their own minds up considering we are all adults here
Just the facts ma'am just the facts
mmmmm I do wonder Simon - I really cant wait to get back to reading other news in the EA rather than this rather slanted view
With a valuation of 200M would this then mean that Springett is worth 10% of the overall company?
And with shares, unlike with a mutual, share ownership translates to voting power.
The long term aim will be to turn this OTM into a RedFin or Purplebricks where the agents all share a common OTM brand.
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