Foxtons has hit
the New Year
with all guns
blazing with a
survival deal
with the banks
and an appeal
against the court ruling on
their tussle with the OFT.
BC Partners, Foxtons’ owner
will inject a further £50 million
to remain the single largest
shareholder, in a deal with
their original backers, Bank of
America Merrill Lynch and
Mizuho, who jointly lent £260
million back in 2007.
Key to the deal was an
agreement with Jon Hunt, the
founder of Foxtons who sold
out to BC for over £300 million.
Jon Hunt has agreed to waive
the £50 million still owed to
him by the company. This
concession made the
restructuring deal possible,
along with a further £140
million in loans from the banks
in return for most of the
company’s equity. Jon Hunt
shouldn’t feel the pinch too
much as his wealth was
estimated at £660 million.
The second prong of
Foxtons’ survive and prosper
plan was announced on
Christmas Eve, with a plan to
appeal against a High Court
ruling on unfair charges to
landlords. If successful, this
could have a very positive
impact on the company’s
financial position.
Their decision to appeal
came after the Supreme
Court’s ruling on bank charges,
which stated that banks did
not need to repay overdraft
charges. A Foxtons spokesman
said, “The Supreme Court in
the bank charges case has
significantly altered the way
in which the courts are to
approach the unfair terms
regulations.” The appeal must
be lodged by 29 January.
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