Real estate listings aggregator Domain Holdings Australia (ASX: DHG) is looking to enhance its technological prowess with the $180 million acquisition of Sydney-based Realbase, a real estate campaign management technology platform.
Domain will pay $180 million in cash upfront for the privilege, plus contingent consideration of up to $50 million which may be payable should Realbase hit financial performance targets.
To fund the acquisition Domain has announced a $180 million raise, with shareholders entitled to buy securities in the company at $3.80 per share - representing a 4.9 per cent discount to Thursday’s closing price.
DHG’s largest shareholder Nine Entertainment Co (ASX: NEC) says it is supportive of the acquisition, and has committed to underwrite the institutional and retail tranches of the raise. On completion, NEC’s holding in Domain would increase from 59.03 per cent to 62.03 per cent.
The listed real estate company, which primarily operates property search site Domain.com.au, says the acquisition is a “significant step forward in the evolution” of its marketplace strategy.
Established in 2020 following the merger of real estate marketing technology businesses Campaigntrack and Realhub, Realbase is the largest campaign management platform in the Australian and New Zealand markets, providing services to agents on approximately 40 per cent of all property transactions in the regions.
The platform enables real estate agents to construct, price, order and track campaign marketing products required to list and market a property, including managing the total marketing schedule of a listing, the property’s visual content, as well as signboards, brochures, flyers, and social & print media advertising.
Domain says the acquisition will increase its market coverage from approximately 35 per cent to circa 50 per cent of all Australian property transactions, and unlock pre-tax EBITDA synergies and scaling efficiencies of up to $18 million by FY26.
“Our mission in Agent Solutions is to build on our track record of trusted partnerships with agents to help them build profitable and sustainable businesses, and deliver value at every stage of the property journey,” Domain CEO Jason Pellegrino said.
“For some time we have been impressed by Realbase’s technological capabilities and products including innovative campaign management, high growth digital proposals and a rapidly expanding social media marketing offer.
“Each of Realbase’s solutions complements and extends the value proposition Domain can take to agents. The acquisition of Realbase meaningfully increases the scale and impact of Domain’s Agent Solutions unit and strengthens our position as the leading provider of end-to-end agent workflow solutions.”
Realbase CEO Frank Greeff said the merger of the two companies would be a win for real estate agents that use the platform.
“When we first started discussing a more connected relationship with Domain and its products, we quickly saw how compatible we were in technology, perspective and team culture. Realbase has a mission to transform real estate through technology, striving to provide customers with the best suite of tools,” Greeff said.
“We are looking forward to scaling and growing alongside a company with a long-standing reputation for trust and quality in the industry. As a collective, our focus is to help agents win listings, and market and sell properties, and the combination with Domain will allow us to continue to provide immense value to our clients.
“The connection of our best-in-class tools with Domain’s existing Agent Solutions, and buyer and seller focused portal offering is a perfect match. We are very excited for the future of this business and our relationship.”
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