Foxtons, London's largest letting agent, has announced its second acquisition of 2023, acquiring Ludlow Thompson for a total consideration of £10 mln (€11.5 mln), further enhancing its lettings offering.
Ludlow Thompson operates across seven branches in London and was founded 30 years ago.
Guy Gittins, Foxtons CEO, commented: 'We are delighted to have completed our acquisition of Ludlow Thompson. Having established a leading position in its local markets and a reputation for delivering the best results for customers, it is clearly a business which we believe is a perfect fit for Foxtons.
'I am very much looking forward to meeting the Ludlow Thompson team over the coming days and welcoming them into Foxtons.'
In 2022, Ludlow Thompson generated revenues of £7.3 mln, of which 70% were focused on lettings. The consideration therefore represents a multiple of 1.4x revenue or 2.0x lettings revenue, in line with recent acquisition multiples.
Whilst Ludlow Thompson generated profit before tax of only £0.1 mln in 2022, returns are expected to be more attractive post integration synergies.
Foxtons executed the £10 mln deal on a cash and debt free basis through the group's cash resources and existing £20 mln revolving credit facility.
Added Gittins: 'We are proudly London's largest lettings agent, with a proven track record of acquiring and integrating high quality businesses. Since inaugurating our lettings acquisition programme in 2020 we have grown our portfolio by over 40%, which now stands at over 28,200 tenancies.
'The acquisition reflects continued progress against our acquisition strategy and our focus on growing recurring lettings revenues, and further supports the delivery of our £25m to £30m operating profit ambition in the medium term.'
Stephen Ludlow and David Thompson, Ludlow Thompson co-founders, commented: 'Having founded the business 30 years ago, taking the decision to sell the business was a major milestone for us, our colleagues, and our clients. We have admired Foxtons for a long time and Foxtons was a natural fit for us, in fact, our processes, our culture and market positioning is based on the Foxtons model.
'As we retire from the business, we would like to thank all our customers for their long-term support along with our colleagues for many years of loyal service and look forward to seeing the new and exciting opportunities that ownership under Foxtons will bring.'