Marsh&Parsons set to put up For Sale sign to new owners

News Category: Industry News

Marsh & Parsons, the London estate agents into which its boss Peter Rollings breathed new life after he quit Foxtons, is set to have new owners which could double the business.

Rollings will keep his stake in the company. But Irish property group Sherry FitzGerald, headed by chief executive Mark FitzGerald  – whose financial clout helped bankroll the purchase of Marsh & Parsons in 2005 – wants to sell its 72% share in what has flowered into a highly successful company.

Several bid approaches have already been made although the business is not yet officially on the market. Rollings said yesterday that he hoped to have the information memorandum ready by early June.

The original Marsh & Parsons firm, which had a reputation for being solid but old-fashioned, was acquired first, followed by the acquisition of Vansons estate agents. The two purchases cost around £5m, Rollings said yesterday, rather less than has been widely reported in City circles although further investment had been needed.

Whatever the original financial investment by Sherry FitzGerald was, it will have paid off handsomely: its stake could be worth as much as £60m, or about ten times what it originally invested.

Going it alone was not a financial option for Rollings, who had never been given an equity share in Foxtons, where he spent 20 years and rose to become managing director after transforming its fortunes.

Frustrated, Rollings quit Foxtons, set on creating his own London-wide firm, specialising in middle to top-end properties and promising to give customers a ‘great experience’.

Jon Hunt, owner of Foxtons who had repeatedly refused to give Rollings an equity share, sold his firm shortly afterwards, in 2007, at the height of the market, for £375m. Yesterday, Hunt was named 79th richest man in Britain with a fortune of £875m – £215m more than he was worth last year in the Sunday Times Rich List.

At the time of the M & P deal, Sherry FitzGerald was riding high on the unprecedented Irish housing boom. Today, it remains the number one Irish agent, with over seven brands and 100-plus branches. However, the housing crash there has hit it for six, like all property businesses in Ireland. Sherry FitzGerald itself estimates that house prices have fallen over 51% since peak and over 13% in the last year alone. It projects further falls of over 18%. Transactions that the firm handles in Ireland were expected to be 4,000 last year as against 10,000 at peak.

By contrast, M & P has thrived as it makes the most of London’s boom. It has 14 branches in London and, helped by astute PR and a clutch of awards, one of the strongest reputations of any estate agent in the capital.

A new owner who buys the Sherry FitzGerald share could help double sales within five years. Cavendish, the corporate finance firm, is advising M & P on its options.

Yesterday, Rollings said: "Sherry FitzGerald have been magnificent strategic partners. I couldn't have asked for better. These are very exciting times, and with the London housing market as strong as it is, going for expansion  makes a lot of sense."



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