Domain to acquire Realbase for $180 million upfront and more
ASX-listed Domain have today announced that it has entered into a binding agreement to acquire 100% of Realbase, for upfront cash consideration of $180 million plus contingent consideration of up to $50 million which may be payable for achievement of stretch financial performance targets.
The acquisition of Realbase is highly strategic, meaningfully accelerating the scale and impact of Domain’s Agent Solutions business unit, with complementary offerings that create a holistic end-to-end solution for real estate agents. On a pro forma basis, the acquisition more than doubles Domain’s Agent Solutions’ revenue for FY22F.
Realbase is the largest real estate campaign management technology platform in Australia and New Zealand, providing services to agents on ~40% of all property transactions. Operating through a number of leading brands, including Campaigntrack and Realhub, Realbase’s platforms enable real estate agents to seamlessly construct, price, order and track the campaign marketing products required to list and market a property, on-market or off-market.
Under the terms of the agreement, Domain will acquire 100% of Realbase for a cash consideration of $180 million plus contingent consideration of up to A$50 million based on the achievement of stretch financial performance targets (“Earn Out Consideration”).
The Earn Out Consideration may be payable for achievement of stretch financial performance for a mix of revenue and EBITDA metrics over a three-year period from FY24 to FY26. Domain may elect to pay the Earn Out Consideration either in cash and / or scrip. The maximum consideration payable (Upfront Consideration plus 100% of the Earn Out Consideration) for Realbase is A$230 million.
Domain CEO, Jason Pellegrino, said, “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. 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, “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. 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.”
Completion of the acquisition is subject to customary closing conditions and is anticipated to occur in late April 2022.