Global publishing group Axel Springer has significantly increased its stake in struggling British real estate portal PurpleBricks.com. The company has paid £43.6 million ($55 million U.S.) to buy 43,662,417 shares, more than doubling its stake to 26.6 percent from 12.4 percent, paying £1 a share.
This means Axel Springer now owns 306,355,916 voting rights in the company and the London stock exchange had to be notified. The stock exchange has also been informed that co-founder Michael Bruce — who recently left the company — and his wife Isabel have sold their complete stake of 306,355,915 shares — previously valued at 11.02 percent — and now have no voting rights in the company.
A stock market announcement confirmed the news. “Following the purchase, Axel Springer SE is beneficially interested in 81,384,638 Ordinary Shares, representing approximately 26.6% of the Company’s issued share capital.”
The digital branch of Axel Springer previously invested £125 million ($157.8 USD) for an 11.5 percent stake in PurpleBricks in March 2018, paying 360p a share. It made a further investment later that year to 12.5 percent for 307p a share.
The news, confirmed by Axel Springer, sent its own shares up by 23 percent. Investors reacted positively because going private could help the firm net further investment to help with future mergers and acquisitions.
Axel Springer has large stakes in the jobs and real estate classifieds sector and has shown interest in acquiring the EBay Classified Group.