THERE was further turmoil in the housing market yesterday as HBOS off-loaded its 13 per cent stake in property website Rightmove for more than £50 million.
The Edinburgh-headquartered bank, which was Rightmove's second-biggest shareholder, disposed of its 16.2 million shares for £59.2m or 364p a share.
It is understood that HBOS's original investment was in the region of £3m eight years ago, giving
it a profit of about £56m.
The stake was worth some £89m three months ago, but Rightmove's shares have fallen from a high of 551.5p in February as the housing market cools. The company is now trading at close to levels seen at its flotation in March 2006.
HBOS was one of the four founder companies of Rightmove with insurer Royal & Sun Alliance, and estate agencies Countrywide and Connells. Only Connells now remains as an investor.
HBOS originally owned 20 per cent of the company, but cut its stake to 13 per cent last year.
Rightmove revealed gloomy trading in an update earlier this month, saying its retention rate for estate agents – the proportion who keep using the website to advertise properties – had slipped to 85 per cent this year, compared with 92 per cent in 2007.
Panmure Gordon analyst Alex DeGroote said: "At this stage in the housing market/property cycle, it is hard to interpret this as a vote of confidence."
A spokesman for HBOS said the sale was a "strategic" decision, and added that it would maintain a close commercial relationship with Rightmove.
HBOS announced plans last month to call on shareholders for £4 billion in cash to strengthen its balance sheet.
Shares in Rightmove were down almost 2 per cent to 378.75p yesterday after the stock was sold on the market.
• Crest Nicholson, the residential and commercial developer owned by HBOS and Scots tycoon Sir Tom Hunter, announced it was cutting one in ten jobs in the faltering housing market.
Up to 80 jobs are to be axed at the building firm – the latest in a long line of developers to cut back on staff.
Chief executive Stephen Stone was reported to have said that the cuts were in response to market conditions.
The full article contains 379 words and appears in The Scotsman newspaper.
