The move comes after Connells increased its offer to 395p a share, following a 325p bid made on 7 December and a previous 250p-a-share approach.
The recommended bid values Countrywide at just over £134m, or about £223.1m when debt is factored in. It creates an estate agency business with more than 1,200 branches across the UK.
Connells – owned by Skipton Building Society – has pledged to invest in the chain’s technology, branch network and workforce. It does not plan to make “material” changes affecting Countrywide’s branch network or workforce.
But it said there were likely to be cost savings and some staff reductions across head office, IT and administrative operations.
Countrywide has its headquarters in Milton Keynes, Buckinghamshire, while Connells is based in Leighton Buzzard, Bedfordshire.
David Livesey, group chief executive of Connells, said: “Our primary motivation for the acquisition is to invest in and grow the Countrywide business.
“We believe that we have the right management team, strategy and investment firepower to work with the talented teams at Countrywide and lead Countrywide into a bright future.”
David Watson, acting non-executive chairman of Countrywide, said: “We have been encouraged by their recognition of the need to put in place a sustainable capital structure and a willingness to support the company, which is a great business that has been constrained by too much debt.
“This significantly improved offer from Connells allows Countrywide shareholders to realise their investment in cash at a price that fairly values the opportunities and risks of the business.”
Countrywide is the larger of the two networks, with some 650 branches, 60 brands, including established Scottish brand Slater Hogg & Howison, and about 9,000 staff. Connells, which started with one branch in Luton in 1936, now has a network of around 580 branches.
Connells said it already had support for its offer confirmed in writing by around 51 per cent of Countrywide investors.
It does not expect any competition issues and is hoping the deal will complete in the first quarter of 2021, if Countrywide shareholders give it the green light.