Foxtons should sell itself, investor says - report

Foxtons should sell itself after failing to capitalise on a frenzied UK property market, an investor in the underperforming estate agent has said.

Converium Capital has called on Foxtons to quit public markets and realise a large premium for investors over the current share price, the Financial Times reported. The Canadian fund has bought about 2% of Foxtons in the past six months.

"As the London property market has started to rebound following its Brexit and Covid-19 induced malaise, Foxtons ought to have risen to its potential," Michael Rapps, Converium's managing partner, wrote in a letter to Foxtons' chairman, Nigel Rich. "Unfortunately, Foxtons has continued to underperform."

Shares of the London-focused estate agent, known for its aggressive sales tactics, have fallen 40% in the past six months even as the UK property market has boomed and rental and sale prices have risen in London.

The shares have lost almost 90% of their value since the company floated in 2013 after a period in private equity ownership. Converium said Foxtons shares, up 1.6% to 32p at 09:13 GMT, could fetch as much as £1 each if the company were sold.

Private equity firms are on the hunt for bargains in the UK market. Foxtons has been owned by buyout firm BC Partners twice.

Converium's letter is the latest attempt by investors to shake up the company. Hosking Partners, Foxtons' biggest shareholder with an 11% stake has demanded "radical change" on the board.

In May 2021, Catalist Partners called on the company to expand outside London but Chief Executive Nic Budden rejected the plan and said Foxtons was showing signs of recovery.

Foxtons reported a return to annual profit on 2 March after revenue hit a five-year high. It also announced a share buyback of up to £3m.