A day after launching its first services to the UK market, digital property exchange platform PEXA Group (ASX: PXA) has expanded its reach with the acquisition of Optima Legal, one of Britain’s largest mortgage processing firms.
The buyout - financial details of which have not been disclosed - gives PEXA access to 22 per cent of the UK’s remortgage market and exposure to six of the region’s top eight lenders.
PEXA’s acquisition comes hard on the heels of the company flicking the switch on its UK platform and making it live yesterday. The group’s remortgage offering has made its debut with the Hinckley & Rugby Building Society and conveyancing firm Muve as its first users. A third customer, Shawbrook Bank, is poised to go live soon.
The company, which now handles about 80 per cent of all property settlements in Australia, was approved in FY22 as the seventh net settlement payment scheme that is able to clear through the Bank of England.
PEXA Group CEO Glenn King says the Optima Legal acquisition will help facilitate the company’s rollout of digital property settlements in the UK. He expects the integration of PEXA’s UK platform into Optima Legal’s systems will demonstrate the benefits of the platform to a significant new segment of the settlements market in the UK.
“In Australia the market understands and has already largely embraced the benefits of a digital property settlement solution, so we look forward to demonstrating that value to a new audience,” King says.
“A recent consumer survey conducted by PEXA concluded that as many as one in five UK mortgage borrowers looking to remortgage in the past 24 months abandoned the process altogether.
“A digital settlement solution will deliver improved accuracy and efficiency while reducing costs. Given the significant volume of remortgaging activity in the UK market, and with volumes expected to increase as interest rates continue to rise, more streamlined systems are urgently needed for the benefit of conveyancers, lenders and, ultimately, borrowers.”
Lenders can choose to us PEXA’s technology directly, or go through Optima Legal or any UK conveyancing firm that integrates with PEXA UK’s platform.
PEXA has also launched PEXA Pay as an alternative property settlement payment system in the UK, with the Bank of England acting as the settlement agent.
The acquisition of Optima Legal will be funded from existing cash reserves, although PEXA notes that it expects to post a loss from the transaction in FY23.
The deal, which is scheduled to settle by the end of this calendar year, is still subject to approvals, including from the Solicitors Regulatory Authority of England and Wales.
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