Tradie marketplace Hipages Group (ASX: HPG) has sold its interest in property maintenance platform PropTech Labs to a subsidiary of Royal Automobile Club of Victoria (RACV) for for $8.4 million.
Hipages has held the 19.5 per cent stake in PropTech, formerly known as Bricks and Agent, since November 2021 with the decision to sell prompted by an approach from RACV subsidiary Home Trades Hub Australia.
PropTech Labs rebranded from Bricks and Agent in FY23 following the acquisition of its largest rival at the time, Maintenance Manager and Inspection Manager, a move that led to a change in direction for the business including the launch of Invoice Automate - an AI-powered invoice automation solution for businesses.
RACV and IAG Insurance (ASX: IAG) first joined the PropTech share register as part of the Maintenance Manager acquisition earlier this year, with RACV now keen to take a bigger share of the growing business.
“Since our original investment in late 2021, PropTech Labs has grown to become the ANZ market leader for property management productivity software,” says Hipages CEO and co-founder Roby Sharon-Zipser.
“With its strategy having evolved, the investment is no longer strategic for Hipages Group, and following an approach by another shareholder, we decided the time was right to divest our stake for an attractive return.
“On completion, the cash will give us additional financial flexibility to execute our strategy while retaining a healthy capital buffer.”
Sharon-Zipser says Hipages will maintain its commercial partnership with PropTech Labs, providing access to job flow from its network of more than one million properties under management, following the sale of its interest in the company.
Hipages says while the deal is expected to be completed by December this year, the timing remains conditional on other PropTech Lab shareholders waiving their pre-emptive rights under the shareholders agreement or participating in the divestment.
The company notes that the sale will see the company realise a 30.9 per cent pre-tax return on its original investment of $6.25 million in PropTech two years ago.
Get our daily business news
Sign up to our free email news updates.