BC goes back to the future with new deal for Foxtons
THE private equity firm that lost control of Foxtons amid the housing slump is on the verge of buying it back from its banks.
BC Partners, led by managing partner Charlie Bott, is set to take a majority shareholding for between £55m and £75m, two years after the estate agent was shored up by a debt-for-equity swap with Bank of America and Mizuho.
The BoA deal has been done and the Mizuho sale is close to completion. The Foxtons management team will retain its stake.
The deal will mark a turnaround for Foxtons, which struggled as house sales plunged during the recession.
BC Partners acquired the chain for about £390m at the height of the buyout boom in March 2007, making an estimated £300m for founder Jon Hunt. The deal was backed by £260m of debt from Mizuho and Bank of America but BC later admitted it was a mistake.
Foxtons struggled when the property market dried up and in 2009 BC said the estate agent had breached the covenants of its bank debt but it was still trading profitably.
Foxtons – known for its branded Minis – has since reduced its reliance on house sales by growing its lettings arm. It bounced back last year as the property market improved. Annual revenues rose 13 per cent to £110m. BC Partners and Bank of America declined to comment and Mizuho could not be reached yesterday.
Last month BC Partners, the owner of gyms chain Fitness First and Swedish cable group Com Hem, raised €6.5bn (£5.45bn), in the largest European fundraising since the onset of the financial crisis.
TIME LINE | FOXTONS: A NOTTING HILL SAGA
1981
Jon Hunt sets up Foxtons as a single agency in Notting Hill in West London.
1982
Introduces longer opening-hours and evening and weekend viewings in a bid to win more business from busy London workers.
2001
Launches its fleet of branded Minis which irritate and delight in equal measure.
March 2006
A BBC documentary accuses its agents of being unscrupulously aggressive. Foxtons’ complaint to Ofcom was not upheld.
March 2007
Sold to private equity firm BC Partners, the owner of Fitness First, for about £390m.
January 2010
BC Partners cedes control of the chain to Bank of America and Mizuho after the property market slumps.
September 2010
BC reportedly enters talks with its banks to buy back debt from Foxtons.