NEW TORY MP Kevin Hollinrake said the £17m float of Hunters Property will help accelerate the growth of the estate agency chain he co-founded in 1992.
The newly-elected MP for Thirsk, Malton and Filey said the Aim flotation will enable Hunters to fulfil its ambition to expand to 500 offices around the country.
He hailed the move as “a success story for Yorkshire and the North of England”.
The York-based group’s managing director Glynis Frew said the flotation is a natural progression for the group. “We want to be the country’s favourite estate agency,” she said.
“At the moment we have just over 150 branches and the float will give us the funding to make strategic acquisitions. We also want to grow organically.”
Around 60 per cent of Hunters’ business is in the North, 23 per cent is in London and 16 per cent in the South and the Midlands.
“We have good coverage in Yorkshire and we will expand wherever there is a gap,” said Ms Frew. Most of the growth will be through franchises.
“It’s about finding like-minded people to run the franchises. We have a great proposition,” said Ms Frew.
Mr Hollinrake’s 15 per cent stake in the company will be worth £2.5m, although Hunters stressed it should be seen as a paper valuation rather than profit and he has no intention to sell any shares.
Only 22 per cent of the company’s shares will be publicly traded and the rest will remain with Mr Hollinrake and the other key investors.
These include Nigel Wray, who supported the launch of the franchise pizza business Domino’s. Mr Wray, the chairman of Saracens rugby club, will hold the biggest stake in the company at 18.8 per cent, which is worth over £3m although the group said he sees it as a long-term investment.
Mr Hollinrake plans to turn Hunters into the largest estate agency brand in the UK market in the next three years. “Hunters is a highly ambitious company,” he said. “Our success to date has been born out of our focus on providing our customers with an exceptional service combined with local market knowledge.
“The group is excited about its next chapter as a public company. This status will help to further enhance the Hunters brand and provide access to capital to accelerate business growth.”
The plan is to buy up small estate agency franchise chains of between five and 20 branches focused on small geographic areas that have built up a local reputation. All the acquired agencies will be integrated into the Hunters’ network.
In addition the group hopes to acquire one medium to large estate agency franchise, of between 20 to 200 franchisees, in 2016 and another in 2017. After that it will buy a large operation every two to three years.
Hunters plans to add at least 20 new branches to the franchise network each year.
Since 2006, the group’s strategy has been to grow a predominantly franchise network. In most cases, the start-up costs of a new branch are borne by the franchisee, reducing the capital risk of expansion to Hunters.