The independent advisory body Institutional Shareholder Services (ISS) has given the thumbs up to CoStar's £99 million proposed deal for the British majority agent-owned real estate portal OnTheMarket.
The vote of confidence is a boost for the bid as ISS is an influential proxy voting and corporate advisory firm whose recommendations often sway how institutional shareholders vote.
American giant CoStar's bid to take over OnTheMarket was made public in Mid-October after CEO Andy Florance took to the stage at the Property Portal Watch conference to tell attendees that his company had a $5 billion "war chest" ready to make some acquisitions in the European portal space.
The fate of the proposal will be decided by OnTheMarket's shareholders in a vote to be held on the 4th of December. Despite some dissenting voices, with today's news it seems increasingly likely that agents will lose control of another real estate portal.
A statement from OnTheMarket welcomed the ISS decision and said that it would remain committed to “maintaining fair and sustainable pricing for agents and intends to continue charging agents a small proportion of Rightmove’s current charges”.
With CoStar's financial backing and expertise, OnTheMarket will look to take on the incumbent market leader Rightmove and number two Zoopla. It's an intention which has been set out clearly from the time the bid was made public and which was re-iterated again in the company's statement:
“CoStar is seeking to create the number one agent-friendly UK residential property portal and a genuine disruptor to the established market leaders.”