Polygon increases Countrywide

Hedge fund Polygon has increased its stake in estate agent chain Countrywide to 22.7% after buying an 8.8% holding from US alternative investor Artisan Partners.

That effectively means the Chelsea-based fund is likely to determine whether the recommended offer from Apollo Management at 590p a share will succeed.

This bid is being submitted through a scheme of arrangement that requires investors speaking for 75% of the share capital to accept the offer at an extraordinary general meeting scheduled for Friday April 13.

Earlier this month, on March 5, Apollo’s bid was accepted by Countrywide’s directors. At the same time, shareholders representing 23.8% of the shares gave irrevocable undertakings to accept the offer. These included JANA Partners, Seneca, Scoggin, ReachCapital, Majedie and Gracie.

Boussard & Gavaudan, which had opposed the original buyout tabled by 3i, also said it would accept the Apollo offer, provided it did not fall below 590p a share. The deal is made up of 510p cash and 0.165 Rightmove shares per Countrywide share. Rightmove is an online property site in which Countrywide has a major stake.

Artisan had opposed the 3i deal but was believed to support the Apollo alternative or “a deal along similar lines”. Apollo is offering Countrywide shareholders a minority stake in the buyout vehicle. Polygon has tried to block a number of deals, including the takeover of Telent last summer and of property group Teesland more recently.

Other hedge funds that have not revealed their intentions regarding the Apollo offer include Davidson Kempner and Och-Ziff, with holdings of 3.9% and 4.8% respectively.

Polygon has built part of its stake through buying contracts for difference above the offer price at 590p to 599p.

Deutsche Bank holds a 6.1% stake in Countrywide, after increasing it from 5.4%.

Chris Spink