Cash-strapped Countrywide has this morning announced that it is selling its commercial business, Lambert Smith Hampton, for £38m.
In a surprise statement - after Countrywide insisted many times in recent years that none of its divisions would be sold - this morning the company described LSH as "non-core” and said the cash from the sale would “significantly improve Countrywide's capital structure following receipt of gross cash proceeds of £38 million and allow the Countrywide Group to materially reduce its net debt.”
In addition to the sale agreement of Lambert Smith Hampton and a share consolidation process, Countrywide has revealed that it has this week agreed an amended credit facility with its lenders.
"The new facility provides the group with the financial flexibility to execute the turnaround plan while operating in what continues to be a challenging and uncertain market environment" says the company.
"The sale of the Lambert Smith Hampton commercial business strengthens the group. Once completed, we believe that the group will be in a more advantageous position in our core residential market. The Group remains on course to deliver a full year result in line with the board's expectations" says executiver chairman Peter Long.
LSH is one of Britain's oldest and most respected commercial properties names, founded in 1773 but only a part of Countrywide since 2013. At that time Countrywide paid £34.1m in cash for LSH which has 33 offices and 1,400 employees; today’s sale is for £38m cash, to a private buyer.
It’s been purchased by John Bengt Moeller who owns Great Global Holdings, a US-based retail-focused property empire.
Meanwhile Countrywide has named Polly Ogden Duffy as managing director of the company’s up-market John D Wood & Co brand.
She takes up the position formally on January 1.
For much of this year Duffy - previously a regional manager at the agency, responsible for part of London - has taken joint responsibility for leading the business with another regional manager, Jonny Dyson, following the death of John D Wood veteran Nick Taylor in the spring.
In a statement to Estate Agent Today Paul Chapman, Countrywide’s managing director of sales and lettings, says: “I am delighted that Polly will lead John D Wood & Co with continued support of Jonny Dyson and the leadership team. We wish Polly and the team every success in her new role.”
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As predicted a sale of the assets, all it will do is prolong the agony. This was a beast of the industry now it is dazed, and licking its wounds waiting for the end, a real shame. It’s only hope is that the Tesco faction can put a strategy together in time to stop a full scale rout. Unlikely, the cash burn is far too high.
Well gross cash proceeds is £38 million, how much will it been after legal & professional fees? Today LSH is gone, tomorrow Hampton may change hand. Too many fat cats in the Group. Take for instance, the estate agency business alone, ask either Paul Creffield or Peter Long, how many Regional Finance Directors they have, do we really need all them? Empower those in the branch driving the sales. Is there a need for sub-head office for very senior executives in Central London, Chelmsford and Milton Keynes? Time for Peter Long to go. Absolute joke this guy.
Johnny cash on the money ‘ hurt’ is maybe a fitting swan song. Get into that c-suite, get the key to the executive loo, and get some 30 year olds in. This perspective is missing, planning your strategy on experience of 50 and 60 year olds has limited relevance in the omni-channel consumer experience that vendors and buyers, landlords and tenants expect. For the love of God it is the 2020’s not the roaring 20’s.
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