Purplebricks sets sights on European expansion
ONLINE estate agency Purplebricks is eyeing German and European firms for acquisition as it continues to expand its overseas footprint.
Chief executive Michael Bruce, who founded the firm with his brother Kenny in 2012, told reporters the group hopes to repeat the success of its Canada deal, which has propelled it into that market.
It has Germany and Europe in its sights following a £125million investment from German publishing giant Axel Springer when it took an 11.5 per cent stake in Purplebricks in March.
But Mr Bruce said the group is not planning to launch into a new market from scratch for the time being while it concentrates on bedding in existing operations across the UK, Australia and North America.
It also wants to grow its UK market share to more than 10 per cent, from what it estimates is 6 per cent or 7 per cent now.
Mr Bruce said: “We’d be more interested at this stage in an acquisition than putting some troops on the ground.” He said the group was taking its time and waiting for the right opportunity in Europe, rather than rushing into any deals.
He said: “We’re not directly touting, but it’s clear that people know us and the brand and what we’re trying to achieve.
“We know who’s doing OK in these markets and we’re observing them.”
He said Axel – owner of German tabloid Bild – has already been highly supportive of Purplebricks and its strategy.
Axel’s classified advertising chief Andreas Wiele has joined the Purplebricks’ board as a non-executive director and the group regularly meets with Mr Bruce and his team.
Mr Bruce said: “They have a “great culture and want us to be successful.”
Purplebricks also secured something of a coup early on, with the backing of renowned fund manager Neil Woodford, who owns more than a quarter of shares in the group.
Having floated in late 2015 just three years after being founded, the group is now worth more than £890million after shares had a stellar run since listing.
But the stock has had a more bumpy ride this year after a spat with Jefferies analysts in February and recent annual results showing hefty losses.
Earlier this month, the group reported pre-tax losses widening to £26.1million for the year to April 30, against losses of £6million the previous year as its global expansion hit the firm’s bottom line. Revenues surged over the year, though, up 101 per cent to £93.6million, with UK sales up 81 per cent.
The group’s focus is firmly on the future, however, with plans to add to its 640-strong team of local agents, having already recruited up to 200 in the past year.
Mr Bruce also plans to get his new UK venture off the ground – Purplebricks Plus – by next April.
The service aims to be an online platform allowing sellers to see all their domestic suppliers on one dashboard.