Purplebricks has revealed this morning that founder Michael Bruce (above) is to leave the business and that it is to close down the company’s struggling Australian operation and consider leaving the US market too.
The news effectively ends the company’s bid to become a global hybrid estate agency.
The shock announcement follows pressure from City investors including fund manager Neil Woodford to turn around the hybrid estate agency after its most recent full-year results revealed rising losses at its US and Australian operations.
Michael Bruce is to step down as CEO with immediate effect and is to be replaced by the company’s 45-year-old Chief Operating Officer Vic Darvey, who joined the company in January from comparison website MoneySupermarket.
The writing has been on the wall for Bruce and its overseas operations since non-exec chairman Paul Pindar (below) was forced to apologise for the company’s performance recently.
“With hindsight, our rate of geographic expansion was too rapid and as a result the quality of execution has suffered,” he said.
Purplebricks, which also counts German publisher Axel Springer as a shareholder, has seen its stock slumping more than 64 percent recently and nearly 9 percent so far this year.
Despite the extraordinary news this morning, Purplebricks has revealed that it is sticking to its revenue forecast of £130 to £140 million for its 2019/20 year’s trading.
The news will be a bombshell for its 600 or more local property experts in Australia and the US, many of whom had left roles at traditional estate agencies to join Purplebricks.
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