Purplebricks expects valuation of £240.3m in IPO

Online estate agency Purplebricks said it has conditionally raised £58.1m from an institutional placing and expects to be admitted to trading on AIM with a market capitalisation of £240.3m.

The company, which is backed by fund manager Neil Woodford, said trading since the end of its financial year in April has continued to see encouraging growth in recognition of its brand and service offering.

Purplebricks said it has “a compelling customer proposition” of a low flat fee combined with a high quality and personalised service, underpinned by its proprietary technology platform.

The group pointed out that while traditional estate agents charge a fee on sales typically within the range of 1% to 3% on the sale price and average at £4,000, Purplebricks’ fee is £1,080.

Chief executive Michael Bruce said: “The IPO will represent a major milestone in the rapid development of Purplebricks, which is already the fourth largest estate agency in the UK based on a monthly run rate of the company's transaction numbers.

“The funds raised will allow us to further deepen our presence across the UK through additional investment in people, technology, infrastructure and marketing to deliver our ambitious growth plans and create value for our shareholders."

Trading in the shares is expected to begin on 17 December.