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TODAY'S OTHER NEWS

Countrywide and LSL planning £500m 'super-agency' merger - claim

Sky News claims that Countrywide and LSL Property Services are discussing a merger to become a £500m super-agency. 

In an exclusive it claims that discussions are said to be serious “although it was unclear how close the two sides are to announcing a transaction.”

It says that Countrywide and LSL are likely to be forced by the Takeover Panel - which polices listed company merger activity - to confirm the talks tomorrow morning.

The deal would create the UK's biggest estate agency group, and if it happens it would come at a critical time in the fortunes of Countrywide in particular, which has seen years of financial and reputational decline, while LSL has come out the other side of a restructuring in a strong financial position.

Sky estimates that the combined workforce of the two agencies would be 14,000 - raising the spectre of substantial job cuts if a deal went through to combine the multiple brands currently run by the two companies.

It’s been a torrid time for Countrywide in recent years.

A branch closure programme, a catastrophically-unsuccessful online experiment and the unpopular retail-styled restructuring under former chief executive Alison Platt - whose time in office saw the group’s share price lose 75 per cent of its value - were by no means the end of the Countrywide calamity.

Its current management has in just two years undergone a shareholder revolt over a so-called Fat Cats bonus scheme, and two embarrassing compliance failures.

One of those failures, revealed in October last year, resulted in a £100,000 fine by the Royal Institution of Chartered Surveyors; the earlier failure involved a £215,000 fine by HM Revenue & Customs as part of a swoop cracking down on lax money laundering procedures in the property sector. 

In recent weeks there has been the management's apparent failure to complete a deal - that in December was supposed to be almost done and dusted - to sell Countrywide’ commercial arm, Lambert Smith Hampton, to a private buyer. 

These have all led to a further long-term decline in Countrywide’s share price.

In the last 18 months LSL, by contrast, has been engaged in a branch closure programme that has had a high price in lost jobs but has seen the company’s overall fortunes improve.

The re-modelling of its Your Move and Reeds Rains businesses last year resulted in 460 lost jobs and another 440 staff moved elsewhere in the organisation.

  • adrian black

    makes complete sense - if you play defence

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    Merging rubbish with rubbish still leaves you with rubbish, just more of it.

  • John Evans

    this will force industry wages down

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    Industry pay is nearly at minimum wage level for many as it is, can’t see the win for either company, without doubt it will lead to further closures between the brands ( is it not rather ridiculous for Countrywide to merge to then make a load more people unemployed by closing dual branded offices which is precisely what they have spent the last couple of years doing ) therefore more customer facing staff will be out of a job due to the continue failures of senior management, nothing changes I guess.

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