Hunters, the franchise chain with over 150 branches and now established as the UK's sixth largest estate agent, could be valued at between £15m and £20m when it lists on the Alternative Investment Market of the stock exchange later this year.
"We quite like the Initial Public Offering route, because it allows us much more access to the capital that we want and raises our profile ... and given that we're a consumer brand, being on the stock market is fantastic," Hunters’ finance director Ed Jones told Reuters.
The company said earlier this year that it intended to raise up to £2.5m through a private pre-IPO placement of shares to investors, including staff and partners to help it expand to over 500 offices in five years.
"We've got hugely ambitious expansion plans and one of the reasons we want to go the market is because of the access to the capital to deliver on those," Jones now says.
Hunters opened its first branch 22 years ago in York. The network is mainly franchised and now has branches nationwide in key cities across the UK including London, Exeter, Birmingham, Leeds, Manchester, Middlesbrough and Liverpool and many locations in between. Hunters also has an office in Alicante, Spain.
In 2014 alone, the Hunters network grew by 37 new locations with the aim of expanding to over 500 offices in five years’ time.
Jones says Hunters would be buyers as he saw an enormous opportunity for consolidation in the sector.
easyProperty and Purplebricks - both online operators - are amongst other agents hoping to float in the near future.
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Raising £2.5m does not give a lot of money to acquire 250 more agencies. That's £10k per agency. No doubt they will rely on acquisitions increasing market cap and therefore access to more funding.
Very true, Glenn. Maybe Hunters are guilty of getting a little bit carried away? Expansion is all well and good, but only if it can be adequately financed. As we've seen with Tesco recently, if your plans go too ambitious and your profits don't match up then you have to start closing stores (or in Hunters case branches) on the sly.
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