Foxtons travelling a seven-year path back to an IPO?

Do you remember the heady M&A years of 2006 when deal-making seemed easy, and valuations were high? (Although in hindsight we might consider them to be unrealistic!)

The reason why I am asking is that on 20th November that year there was a story in UK broadsheet the Daily Telegraph that Foxtons, the trendy, mini-driving London estate agency, was considering an initial public offering (IPO) on the London Stock Exchange that would have valued the company at up to £400m.

The IPO didn’t happen and within less than a year private equity firm BC Partners had swooped and purchased the company for a reported £400m. The deal closed on the 31st December 2007, roughly six to eight months before the financial meltdown that took the world into an economic depression arrived and, which also coincided with the start of the decline in the British housing market.

Today, stories have broken that BC Partners is considering an IPO of Foxtons that, according to the reports, would almost double its equity investment. This investment of BC Partners has surely been challenging; with the ongoing depressed state of the UK housing market there must have been times, especially when lenders took control of Foxtons back in 2010, when BC Partners must have wondered if their exit would ever come, and if it did, would it make any return at all?

If ever there was proof that patience, hard work and an element of luck plays a part in successful investment, then this might be the deal to prove it.

Filed under: dealmaking, IPO, M&A, credit crisis