REA Group's recent proposal to acquire Rightmove, a UK-based digital property platform, has been rejected. The offer, made on 27 September 2024, was the fourth non-binding indicative proposal from REA and was turned down by Rightmove just three days later. REA's strategic rationale behind the proposal was to establish a globally diversified digital property company with strong footholds in both Australia and the UK.

REA's approach was driven by the belief that the proposed merger would have provided Rightmove shareholders with the opportunity to participate in a fast-growing, diversified, global leader. However, Rightmove's share price has lacked sustained upward momentum for two years, despite being supported by its ongoing share buyback programme and revised strategy. The fourth proposal represented a 45% premium to Rightmove's 12-month and 24-month volume weighted average share prices.

REA Group's CEO, Owen Wilson, expressed disappointment at the lack of engagement from Rightmove, stating, "Against a backdrop of intensifying global competition, we approached Rightmove's Board because we strongly believed in the opportunity to create a globally diversified leader in the digital property sector that would benefit both REA and Rightmove shareholders. We were disappointed with the limited engagement from Rightmove that impeded our ability to make a firm offer within the timetable available. They had nothing to lose by engaging with us."

REA maintains a disciplined approach to mergers and acquisitions, and the potential acquisition of Rightmove was dependent on reaching an agreement at a fair price. However, the lack of engagement from Rightmove impeded discussions and progress towards a recommended transaction.

Despite the setback, REA remains confident in its growth potential across its core business, adjacent opportunities, and in India. Wilson added, "We are always financially disciplined when we look at M&A and reinvestment in our business and will continue to focus on the many other opportunities ahead of us. Our recent investment in Athena Home Loans is a great example of this. We have a clear strategy to expand in our core business and adjacent markets, and India represents an exceptional opportunity for growth. We look forward to pursuing these opportunities and generating further value for REA shareholders."

REA Group, a multinational digital advertising business specialising in property, reported a 23% increase in revenues and a 27% increase in EBITDA (excluding associates) in its full-year financial results released on 9 August 2024. Despite the rejection from Rightmove, REA Group remains a strong player in the digital property sector.