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The CWD/Connells document certainly threw up a few interesting facts in the timeline.
Having signed off a confidentiality agreement on March 3rd it's clear Connells were already on the scene during or shortly after the proposed merger with LSL. So Connells would have been all over CWD like a rash conducting due diligence since probably February 2020 .
More than sufficent time to look under the bonnet and to acquaint themselves with the facts by the summer .
On the 3rd March the share price was around 259p . A further clean sheet agreement was entered into on March 12 th when the SP had slid to 146p when the pandemic started raising its head .
Then the pandemic lockdown struck so clearly that would have be a spanner in the works and halted proceedings and by the end of March the share price dive bombed to just 40p
However, it soon became apparent it was clearly an overreaction . Connells not only at their branches as well as CWD were experiencing deals were still crossing the line during May and April and also enquiries coming in thick and fast from prospective buyers .
In addition both companies benefiting on savings on staff wages from furloughing
A spring in everyone's step in June easing from lockdown as and then the stamp duty extension in July Increased activity in all sectors which hasn't stopped since as evidenced by the increases sales of 55% in Q4, year on year CWD privvy to all this .
Clearly apparent to Robin Paterson in July too having acquired a substantial holding
The share price was still below 100p mid July and 111p in m mid August significantly below that in March when Connells struck the agreement
If Connells had come in with an offer of 260-275p at that time then shareholders would have bitten their arm off
Now having to pay over £40m more
What on earth were they waiting for ?
i imagine they were waiting to see ow the Pandemic was panning out.
I imagine a pipeline of 55% up-must be the only firm in country currently not trying to get the pipeline through any time fast.
Elephant in the room-if Connells have money to spend on this Aq why dont they follow Savills/Belvoir etc in paying back the Gov support monies. This will come back and bite the Skipton in my opinion from moral perspective.
With a potential longer hangover now of Covid and new strains -and pressure on both groups to shut branches for safety(both dinosaurs in remote working)- its bum twitching time IMO for Skipton. Plus when the group acquired RSA (a real basket case)the Connells management team, was far stronger and lets be honest younger !I can see no one on the board good enough to parachute into CWD-most remainers being ex RSA/Sequence. Profits have been falling year on year recently and Connells brand is a shadow of its former self
Major,
Yes,I guess that was it and only chose to abandon that strategy of waiting to see how pandemic pans out (still panning !) when Alchemy popped up to spoil the party
They never even entered the game with a stake
However in July with the arrival of Robin Paterson in July and Hoskings in August it had been clear that the share price had been well oversold
It was now a bargain basement buy . Clear and present danger of some heavy artillery arriving to claim the prize
A once in a lifetime opportunity for a diceroll which they could have well afforded to do with a limited downside withe stellar brands in the portfolio
Let's face it most of the damage done at CWD has been self-inflicted by the BODS All CWD needed was a steady hand of the rudder
I should also imagine Connells continuing interest was also difficult to keep confidential too for such a long period of time too.
Furthermore despite sales were flying stamp duty savings coffers filling up they would also have established that the the BODS had to do something to relieve the pressure from the banks
The lockdown had yielded the benefit of substantial saving some staff wages ,the time to pounce
The BODS staggering from one crisis to the next likely to jump into bed with the first girl that offered
if it wasn't Alchemy it was going to be Paterson or A.N.Other
Their hesitancy has cost them well north of £40m which was more than the total value of it late Spring
Interesting. Guess the gamble isn't that difficult to play when your using Skipton members money!