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This announcement is not an offer to sell, or a solicitation of an offer to subscribe for or to acquire, securities in the United States or in any other jurisdiction, including in or into the United States, Australia, Canada, Japan or South Africa. This announcement is an advertisement and not an admission document or a prospectus. It does not constitute or form part of, and should not be construed as, an offer to sell or issue, or a solicitation of any offer to buy or subscribe for, any securities, nor should it or any part of it form the basis of, or be relied on in connection with, any contract or commitment whatsoever. The distribution of this announcement in certain jurisdictions may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdictions. Investors should not subscribe for or purchase any securities referred to in this announcement except on the basis of information in the admission document (the "Admission Document") which will be published in due course by OnTheMarket plc ("OnTheMarket" or the "Company") in connection with the proposed admission of the ordinary shares in the capital of the Company to trading on AIM, a market operated by London Stock Exchange plc.
OnTheMarket plc raises £30 million with trading on AIM scheduled for 9 February 2018
26 January, 2018
The Board of OnTheMarket plc is pleased to announce it has been successful in conditionally raising £30 million through the placing of new Ordinary Shares. It is expected that dealings in its shares on AIM will commence on 9 February 2018.
The key proposition of the business remains the creation of an agent-backed, full-scale property portal to disrupt what is otherwise a duopoly of Rightmove and Zoopla by offering a premier search experience to consumers whilst charging sustainably fair prices to agents.
From Admission, the Directors believe the OnTheMarket portal will have over 5,500 branches representing around a third of the total UK residential property listings.
Agents provide the majority of income for the property portals and also supply the majority of their most valuable content - the property listings. As a portal with significant agent support, the Directors believe OnTheMarket.com is uniquely positioned to create an alternative to the leading incumbent portals and to provide an opportunity for a broad base of agents to participate in the equity value of their own portal.
Other key elements of the strategy are:
· increasing the marketing budget to up to £25 million per annum for the first two years to raise the profile of the OnTheMarket.com brand and continue to build the consumer audience;
· investing to scale up the Company's infrastructure, especially its sales and customer relationship management organisation and its technology development;
· growing substantially the core customer base of estate and lettings agents and other property advertisers using the portal; and
· accelerating agent recruitment and broadening agent backing with the targeted use of equity incentivisation for key agents committing to support the portal with long term listing agreements.
· Dealings in the Ordinary Shares are expected to commence at 8.00am on 9 February under the ticker "OTMP" with the ISIN GB00BFN3K335.
· The Placing consists of 18,181,818 new ordinary shares, raising gross proceeds of £30 million for the Company, at a price of 165 pence per ordinary share ("Placing Price").
· On Admission it is expected that agents will own more than 70 per cent. of the issued share capital.
· The Company's market capitalisation on Admission, based on the Placing Price, is expected to be £100 million.
Ian Springett, Chief Executive Officer of OnTheMarket plc, said: "We are pleased to have secured the backing of such a high quality investor base. We believe that the new capital, together with our ongoing revenues, will support our strategy to build a strong agent-backed challenger to the incumbent portals. We intend rapidly to extend our customer base of estate and lettings agents, remaining committed to our core principles of offering sustainably fair prices for property advertisers and creating a premier search service for the most active property-seekers. The IPO will enable us to implement our marketing plans to build brand awareness and portal usage as well as to invest to scale up the supporting organisation and infrastructure to the benefit of consumers, agents and investors."
Zeus Capital acted as Financial Adviser and Broker on the Placing and IPO.
For further information, please contact:
Ian Springett, CEO
0207 930 0777
TB Cardew (Financial PR adviser)
0207 930 0777
Ed Orlebar or Tom Allison
07738 724 630 or 07789 998 020
Zeus Capital (Nominated Adviser/Broker)
Martin Green, Giles Balleny, Pippa Underwood
Benjamin Robertson, John Goold (Broking)
0203 829 5000
Background on OnTheMarket
Launched in January 2015, the OnTheMarket.com property portal was created by Agents' Mutual Limited, a company limited by guarantee and founded in January 2013 by a small group of agent firms, with the objective of creating a new portal to challenge the dominance of Rightmove and Zoopla. Both groups were felt to be using their strong positions relative to their agent customers to impose significant price increases for their portal services.
The Agents' Mutual proposition of an agent-backed portal offering a premier search service to consumers whilst charging fair prices to agents quickly found support among a very wide group of leading independent agents across the UK. These firms funded the venture by way of loan note subscriptions and committed to list with the portal once it went live.
OnTheMarket is the third biggest UK residential property portal provider in terms of traffic and has, with backing from its agent owners, developed unique sources of competitive advantage such as the "New and Exclusive" property listings.
In order for the IPO to proceed, Agents' Mutual asked its members to vote in favour of a resolution to convert their membership interests in Agents' Mutual into ordinary shares in a new company, OnTheMarket plc. Holders of loan notes were also asked to vote in favour of resolutions exchanging their loan notes in Agents' Mutual for convertible loan notes in OnTheMarket. All resolutions were passed with a large majority. On 11 September 2017, the courts sanctioned the schemes of arrangement and following the necessary filings at Companies House they became effective on 13 September 2017.
The Board believes that the IPO will provide the opportunity for a transformational step-change in the portal's position and for the development of new consumer and agent products and services and the targeting of revenues from new segments of the property market and new strategic partnerships.
Zeus Capital Limited is authorised and regulated by the Financial Conduct Authority and its registered address is 82 King Street, Manchester M2 4WQ.
Directors of OnTheMarket plc
Chris Bell, Non-Executive Chairman
Christopher has considerable listed board experience across a range of sectors. He has, since 2015, been Senior Independent Director for The Rank Group Plc, where he also serves on both the Audit Committee and the Nominations Committee. He is Non-Executive Chairman of two AIM-listed companies, XL Media plc and TechFinancials, Inc, both of which he took to market and at both of which he serves on key governance committees. He is also a Non-Executive Director at AIM-listed Gaming Realms plc. Christopher joined Ladbroke Group plc in 1991, becoming Managing Director of its Racing Division in 1995. In 2000, he became Chief Executive of Ladbrokes Worldwide and joined the Board of the rebranded Hilton Group plc, becoming Chief Executive of Ladbrokes plc, following the sale of the Hilton International Hotel division, until 2010. He has also served as Non-Executive Director at Spirit Pub Company plc (from 2011 to 2015) and as Senior Independent Director at Quintain Estates and Development plc (from 2010 to 2015). Prior to joining Ladbrokes plc (formerly Hilton Group plc and Ladbrokes Group plc), Christopher held senior marketing positions at Allied Lyons plc.
Ian Springett, Chief Executive Officer
Ian joined the business in April 2013 as founding CEO. After holding a number of senior banking roles over 15 years within NatWest Group, the last five years of which as Managing Director of Lombard Bank, Ian founded PrimeLocation.com in 2000 and, as Chief Executive, led its growth and ultimate sale to DMGT in 2006. He remained with the business until 2008, when he left to pursue other interests. From 2012, he worked with the agent founders of Agents' Mutual to develop its strategy and proposition and led the recruitment of the broader group of agents who provided funding for the venture in early 2014. Ian has driven the successful launch and growth of the OnTheMarket.com business and led its recent demutualisation in preparation for the planned capital raising.
Helen Whiteley, Commercial Director
Helen joined Agents' Mutual in August 2013, having previously been Sales & Marketing Director and part of the founding management team at PrimeLocation.com. Helen began her career at Citibank and later joined Lombard Bank, where, as Marketing Director, she developed the Lombard Direct brand with national TV, press and direct marketing campaigns to achieve a market-leading position. Helen has been central to the planning, development and growth of OnTheMarket.com, with responsibility for sales, member relations and marketing.
Clive Beattie, Chief Financial Officer
Clive joined the business in March 2017. Having qualified as a chartered accountant with PriceWaterhouse he spent 12 years working in investment banking with UBS before working six years at ThruVision, a security technology business, initially as CFO and then also as CEO. Clive then spent three years as CEO/CFO at Croft Associates, a business specialising in containers for the transport and disposal of radioactive materials.
Ian Francis, Non-Executive Director
Ian has extensive listed board experience both from his executive career as a senior audit partner with Ernst & Young and from his subsequent roles at Umeme Limited and at Paysafe Group plc. He was appointed to the board of Paysafe Group plc (previously Optimal Payments plc) in 2010 as a Non-Executive Director and served until its acquisition as Chairman of the Audit Committee. Prior to this, he was a senior audit partner with Ernst & Young London until 2009, specialising in FTSE-listed and multinational companies. He also served as a Non-Executive Director of Umeme Limited, the privatised national power distribution company of Uganda, from 2009 to 2014. Ian established and chaired Umeme's Audit Committee. Ian is also an active mentor at Board Mentoring, supporting executive and non-executive directors stepping into new situations and roles.
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