Property website operator REA Group is set to take over mortgage broker franchise group Mortgage Choice, after the two companies announced that they have entered into a scheme implementation agreement.
In a deal worth A$244 million, REA proposes to acquire 100 per cent of Mortgage Choice, offering $1.95 a share – a 66 per cent premium to Mortgage Choice’s closing share price on March 26 and a 66.8 premium to its one-month average piece.
The Mortgage Choice board has recommended that shareholders vote in favour of the offer. Shareholders will meet in June.
The Mortgage Choice business has been going nowhere for some time, with a loan book that has not grown since 2018, problems growing its franchise network and an investment in financial planning that has not paid off.
Mortgage Choice chair Vicki Allan said the business would benefit from combining with REA’s Smartline broking business and getting access to its digital capability.
REA operates realestate.com.au, realcommercial.com.au, share property site flatmates.com.au, short-term co-working site Spacely and property data services business PropTrack.
It operates websites in Malaysia, China, Thailand and has investments in Indian property businesses.