Baillie Gifford, an asset manager and investment trust firm, has announced that it will be backing the management team of Scout24, a German classifieds group. Scout24 has recently been on the receiving end of calls by activist investor Elliott Advisors to break up the business.
Considered one of five of the biggest shareholders in Scout24, Baillie Gifford is assured that the team's CEO, Tobias Hartmann and the period of stability, will be what the company needs to execute its strategy.
“We want to support the management to achieve its future goals rather than seeking to deliver a short-term return at the expense of long-term value creation for shareholders,” Fund Manager Jenny Davis said in a statement.
The German classifieds group said that it would either decide on a sale or a spin-off of its auto platform to appease Elliott Advisors' demand which expects Scout24 to garner 2.5 bullion euros from the right buyer.
Scout24 is feeling the pressure from Elliott which comes after a failed private equity bid to take over the company at 46 euros per share. Something the management had recommended to shareholders to begin with.
Baillie Gifford voted against that move, saying its conviction in the business had strengthened on the basis of constructive conversations with the CEO and with the Scout24 Chairman, Hans-Holger Albrecht.
Currently, Baillies Gifford owns 3.6% of Scout24. Elliott's stake is 7.5% and Scout24 shares traded up 1% at 52 euros in Frankfurt.
SOURCE Scout 24
Edited by V. Haviland
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