CURRENT economic conditions and global recession concerns have muzzled merger talks between residential property manager Wentworth Holdings and real estate agents Century 21.
C21 Australia managing director and owner Charles Tarbey said market conditions have placed unforeseen pressures on the residential real estate market such that the dynamics of the proposed Wentworth and C21 Australia merger did not make sense for all stakeholders.
This view was echoed by Wentworth’s chairman Colin Cowden who said he was disappointed the merger is not proceeding.
The parties entered into a heads of agreement to merge their businesses in September this year.
The merger would have created a group with over 12,000 rental properties under management and over 260 franchised real estate offices around
Despite the failed merger, Wentworth has invited Tarbey, who has accepted, to become an executive director.
As a result, Jim Gardiner has stepped down from that role and has agreed to remain as a non-executive director.
Wentworth will offer Tarbey the following incentive package:
• 5,000,000 shares to be issued on approval by shareholders;
• 5,000,000 shares to be issued on achievement of a breakeven EBITDA (from normal operations);
• 5,000,000 shares to be issued on achievement of $1.0 million in reported EBITDA; and
• 5,000,000 shares to be issued on achievement of $2.0 million in reported EBITDA.
“During the due diligence process we have come to know Tarbey and his skill set and formed a view that he is an ideal person to lead the company into its next phase,” Cowden said.
“Current management have invested significant time restructuring the Wentworth business under difficult conditions and it is now time for new personnel to commence the restoration of value to shareholders,” he added.
The parties have not ruled out a merger in the future.
Australian Property Journal
