Australia’s Domain Holdings announced on Monday that it would recommend shareholders vote in favor of a takeover bid by U.S. property data group CoStar, which values the real estate classifieds company at A$2.80 billion ($1.76 billion).
Following the announcement, Domain’s shares dropped by up to 2.3%, reaching A$4.230 at 0218 GMT.
The board of Domain stated that it plans to support the takeover scheme, provided no superior offers emerge and an independent expert approves the deal.
CoStar has been granted exclusive access to Domain’s data for due diligence as part of its revised buyout proposal. Last week, CoStar increased its offer to A$4.43 per share on a “best and final” basis, a 5.5% premium over its previous offer of A$4.20.
Domain confirmed that CoStar will be given access to a virtual data room, and the exclusivity period will last for four weeks unless extended by another two weeks.
Domain’s largest shareholder, Nine Entertainment, recently confirmed it was in discussions to sell its 60% stake in Domain. Following this news, Nine Entertainment’s shares fell by 2.4%, reaching A$1.508, their lowest point since February 20.
If the acquisition goes through, it would mark CoStar’s first move into the Australian market. It could reshape the industry, where listing volumes have declined due to high living costs affecting the once-thriving housing market, though conditions are improving with lower interest rates.
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