London-listed estate agent Foxtons has confirmed it is in talks to buy West London-based agent Douglas & Gordon.
In a statement, Foxtons said the discussions “reflect the company’s stated ambition to acquire high quality businesses with strong lettings books.”
Douglas and Gordon, which is run by former Foxtons executive James Evans, has 17 branches in London.
It comes after a report by Sky News which revealed Foxtons is in exclusive negotiations to acquire the chain for around £15m.
Last year Foxtons raised more than £20m from shareholders after warning of a dip in revenues as a result of the pandemic.
Group revenue for the three months to the end of 30 September was down 10 per cent to £28.5m due to fewer high value short-term lets and a reduction in overseas student tenants.
Today the publicly listed firm confirmed “any potential acquisition would be funded by the company’s existing cash resources.”
Shares in Foxtons plunged nearly 10 per cent following the statement. The stock had rallied in recent weeks due to rumours of a possible private equity takeover.
The Times previously reported a number of private equity firms were circling Foxtons in on the hopes of a revival in the high-end London property market.
It is not the only deal in the property sector in recent weeks. Last week Countrywide shareholders approved a takeover offer from rival firm Connells, valuing the company at around £223.1m.