(Reuters) – Australia’s Domain Holdings said on Friday U.S. online real estate firm CoStar would acquire the property classifieds company for an implied enterprise value of A$3 billion ($1.92 billion).
Under the deal, CoStar and its unit, which already owns a 16.9% stake in Domain, will acquire the remaining shares in the company at A$4.43 apiece, a 4.2% premium to the stock’s last closing price on Thursday.
Domain may also decide to declare a special dividend of up to A$0.10 per share, which will reduce the deal value by that amount, it said.
The deal marks CoStar’s first foray into the Australian market and could transform the landscape in a sector where listing volumes have sagged as high living costs slowed the country’s hot housing sector but are improving with interest rates coming down.
Domain’s board has unanimously recommended that shareholders vote in favour of the proposed deal, which is also subject to Foreign Investment Review Board (FIRB) approval.
Domain’s 60% owner, Nine Entertainment, said in a separate statement that the deal “appropriately reflects the strategic value” of its interest in Domain and it intends to vote in favour of the deal in absence of a superior offer.
($1 = 1.5640 Australian dollars)
(Reporting by Himanshi Akhand in Bengaluru; Editing by Rashmi Aich)
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