Foxtons Group acquires FleetMilne

Foxtons Group has entered into an agreement to acquire FleetMilne, a Birmingham-based lettings agency, for £4 million. This acquisition marks Foxtons' expansion into Birmingham, the UK’s second-largest city, reflecting its strategic focus on increasing non-cyclical, recurring lettings revenues.

The deal includes an initial payment of £3.2 million, with an additional £0.8 million to be deferred over 12 months, contingent upon meeting specific performance targets. This acquisition will be funded through Foxtons' existing revolving credit facility. FleetMilne’s revenue is heavily skewed towards lettings, accounting for approximately 95% of its income, aligning with Foxtons’ strategy of focusing on earnings-accretive businesses. FleetMilne reported unaudited revenue of £1.5 million and a profit before tax of £0.2 million for the year ending 30 September.

The acquisition provides Foxtons with a foothold in a market characterized by redevelopment activity, new homes, build-to-rent schemes, and improved connectivity with London, including the HS2 rail link. By integrating FleetMilne, Foxtons aims to extend its successful acquisition model beyond the London commuter belt, tapping into Birmingham's growth potential. Chief Executive Guy Gittins highlighted that the expansion into Birmingham represents a significant strategic move, facilitating organic growth and enabling further bolt-on acquisitions.

In terms of market dynamics, this acquisition signifies Foxtons’ continued commitment to diversifying its geographic footprint beyond London. The Birmingham market offers substantial opportunities driven by infrastructure projects and housing initiatives. This development may spur competitors to consider similar geographic diversification strategies to capitalize on regional growth opportunities outside of London.

Foxtons anticipates the acquisition will be earnings accretive from 2026 onwards, targeting a 20% return on investment in Birmingham. The existing leadership at FleetMilne will remain, offering continuity while leveraging Foxtons’ technology and expertise to scale operations. The completion of this transaction solidifies Foxtons' strategic positioning for future growth in the UK's highly competitive real estate market.