Domain Holdings (ASX:DHG) agrees to buy Realbase

3 min read | April 01, 2022 04:09 PM AEDT | By Sonal Goyal

Domain Holdings (ASX:DHG) agrees to buy Realbase — Image source: © Rummess | Megapixl.com

Domain Holding to acquire Realbase

Domain Holdings has inked a binding agreement, through its subsidiary company, to acquire Realbase Pty Ltd. Domain will be paying AU$180 million of upfront cash consideration. The transaction includes conditional payment of up to AU$50 million, which will be paid if specific financial performance targets are met. The upfront consideration will be paid through an entitlement offer.

Image source: © Jirsak | Megapixl.com

Realbase is a campaign management technology platform in New Zealand and Australia that offers services to real estate agents.

Domain has marked the acquisition of Realbase as a crucial step in the evolution of its marketplace strategy and has listed the numerous benefits that it expects to enjoy after completing the acquisition. Here we have discussed a few.

With this transaction, the impact and scale of the agent solutions unit of Domain are expected to accelerate significantly. In addition to this, the acquired entity provides a complementary marketplace offering that will help in creating a holistic end-to-end solution for property agents. Domain said that it expects to more than double agent solutions’ revenue in the financial year 2022. Furthermore, the acquisition increases the market coverage of Domain Holdings from over 35% to over 50%.

The solid senior management team of Realbase will continue, and it is expected to play a crucial role in accelerating the synergy and stand-alone growth of the company.

Jason Pellegrino, CEO of Domain, said on the development,

Domain has not upgraded its FY22 ongoing cost guidance post the acquisition news but informed that expenses would increase in FY22.

Entitlement offer announced by Domain Holdings

Domain Holdings has announced a fully underwritten entitlement offer to raise AU$180 million for funding the Realbase acquisition. Around 47.4 million new Domain shares will be issued under the entitlement offer at the price of AU$3.80 per share.

The company will open the retain entitlement offer on 8 April 2022 and close the same on 28 April 2022.

Nine Entertainment Co Holdings Limited holds 59.03% shares in Domain and has shown support for the acquisition. Nine said that it would be participating in the entitlement offer and committed to sub-underwrite the retail and institutional tranches of the entitlement offer up to 18.9 million.

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