Investor Jasim Alseddiqi buys stake in Foxtons and backs management's turnaround plan

Mr Alseddiqi, who is the largest shareholder in Dubai's Shuaa Capital, acquired the stake in a personal capacity

A Foxtons estate agent sign outside a branch in London. UAE investor Jassim Alseddiqi has acquired 2 per cent of the company. Reuters

Abu Dhabi-based investor Jassim Alseddiqi has acquired 2 per cent of London's Foxtons Group and says he is backing its management’s plan to turn around the company.

Mr Alseddiqis's intervention comes after Converium Capital said in March that the property broker should pursue a formal process to sell itself, citing insufficient cost controls.

“Any attempt for the company to sell itself at this stage forgoes the massive future potential of the company,” Mr Alseddiqi wrote in a letter to management provided to Bloomberg News.

Mr Alseddiqi is the largest shareholder in Dubai-based Shuaa Capital, which oversees about $14 billion in assets.

Foxtons, whose branded Mini Coopers were once a symbol of London’s red hot housing market, has struggled after home sales volumes failed to fully recover after the financial crisis.

The property broker was also hit when the government unveiled a series of tax increases from late 2014 that damped the city’s property prices.

Mr Alseddiqi, who bought the Foxtons stake in a personal capacity, did express concern about the situation at the company, which has shed about 37.5 per cent of its value in the last year.

He urged it to focus on growth opportunities, including expansion in affluent boroughs and cross-selling its management services.

“The company has an inflation-protected business model, benefits from an optimal capital structure, high contribution margins and significant operating leverage,” he said.

Foxtons’ pretax profit shrunk from £42 million ($50.54m) in 2014 to £5.6m last year while its market value slumped by about 90 per cent in the period.