Foxtons sells Douglas & Gordon sales business and integrates rental unit

The British estate agency acquired London-based estate agent D&G in March for 15.5 million pounds ($21.2 million), with significant lettings business and loss-making sales business. Rental activity performed well in 2021, but sales activity contributed to an operating loss of around £1.9million in 2021, he said.

The total gross assets of D&G’s sales activity at the end of 2021 was £10.6m, primarily relating to leasehold rights of use and cash.

The company said it considered a number of options to improve the profitability of the sales business and concluded that selling the business to D&G management and integrating the rental business was the best option.

Synergies resulting from the integration of the rental business are expected to generate operating profit in 2022 of approximately £4 million, while the divestiture will result in an impairment loss of approximately £3.0 million . A total of £3.7 million in cash will be left in the business to cover working capital and unallocated liabilities.

Write to Joe Hoppe at joseph.hoppe@wsj.com