UK property agency Foxtons Group has acquired peer Atkinson McLeod for £7.4 mln (€8.4 mln), which will be funded through the group’s existing cash resources.
The business is being bought from certain private individual shareholders.
Atkinson McLeod is an estate agent operating in Central East London across four branches, with a significant lettings business that generates around 90% of its revenues across around 1,100 tenancies.
The acquisition of Atkinson McLeod reinforces Foxtons as London's largest lettings brand according to the firm.
Since 2019, the group has significantly increased the size of its lettings portfolio through acquisition, driving good levels of growth in lettings revenue and profitability.
For the year ended 31 December 2022, non-cyclical and recurring revenues, primarily delivered by lettings, represented around 65% of group revenue.
The acquisition constitutes a class 2 transaction pursuant to the UK listing rules. For the purposes of the rules, Atkinson McLeod’s unaudited revenue and operating profit for the 12 months ended 31 March 2022 were £3.1 mln and £0.9 mln respectively. Gross assets as at 31 March 2022 were £2.5 mln.
Foxton's directors said they believed the acquisition of Atkinson McLeod would be earnings accretive in 2023, and through the delivery of synergies, post-completion profitability will be enhanced from historical levels.
Total consideration for the acquisition is £7.4 mln, adjusted for current assets less total liabilities at completion, of which £0.7 mln is deferred for a period of 12 months.