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Highlights:
Domain Holdings Australia Ltd (ASX:DHG), part of the broader real estate sector, has entered a definitive agreement to be acquired by its US-based partner. The agreement, which outlines a scheme implementation deed, involves a full cash acquisition of all remaining shares not already owned by CoStar Group. Domain is currently part of the ASX 200 index and has seen notable market attention following the announcement.
Nine Entertainment Co Holdings Ltd (ASX:NEC), which maintains a majority stake in Domain, is listed on the ASX and is also part of the ASX 200 index. Nine has confirmed its backing of the deal, subject to standard conditions, while also noting that it aligns with its strategic asset management objectives.
Unanimous Board Agreement and Shareholder Intentions
The board of Domain has unanimously supported the transaction, stating that it is in favour of the proposed scheme. This recommendation stands provided there is no alternative agreement deemed more beneficial and subject to a formal independent assessment.
Nine Entertainment has echoed Domain’s position by voicing its intent to vote in favour of the transaction. This stance is also conditional, mirroring the guidelines expressed by Domain’s leadership team. The approval process is expected to follow standard governance steps, including further shareholder engagement.
Cash Transaction Structure and Dividend Announcements
The deal will see CoStar issue a cash offer for the remaining shares in Domain, with the price structured to reflect adjustments based on any special dividends that may be declared prior to the transaction's finalisation.
Following the completion of the deal, Nine has announced that it plans to distribute a portion of the proceeds to its shareholders via a special dividend. This dividend is expected to be fully franked and issued in addition to any final payout related to the current financial year.
Corporate Commentary and Market Positioning
Leadership at CoStar has expressed a focus on combining innovation and scale to support the property marketplace in Australia. With Domain's established presence and CoStar's existing stake, the transition is set to further solidify both entities' real estate positions across their respective markets.
Nine Entertainment has stated that the review undertaken before approving the agreement with CoStar confirmed that the offer reflects the company’s strategic view on Domain’s value. The expected proceeds from the sale place Nine in a stronger cash position, post-transaction and taxation.
Completion Timeline and Broader Implications
The agreement is scheduled for completion during the third quarter of the calendar year. The timeline is contingent upon standard approvals and procedural milestones. Upon closure, Nine is anticipated to receive net proceeds from the transaction, thereby increasing its overall liquidity position.
Both Nine and Domain remain part of the ASX 200 index, which includes some of the largest and most actively traded companies on the Australian Securities Exchange. Their movement within this index will continue to attract close monitoring as the acquisition progresses toward finalisation.
