- REA Group (REA) completes its acquisition of Mortgage Choice (MOC), boosting its foray into the home loan market in the process
- The company purchased all the shares in Mortgage Choice at $1.95 each, valuing the mortgage broking business at roughly $244 million
- Mortgage Choice generated revenue of $22.2 million in the last six months of 2020 and recorded after-tax profit of $4.1 million
- The purchase is designed largely to accelerate REA Group’s financial services strategy
- REA Group is down 1.27 per cent to $166.88 per share at 12:27 pm AEST
REA Group (REA) has completed its acquisition of Mortgage Choice (MOC), boosting its foray into the home loan market in the process.
The deal was originally put forward in late March, whereby REA Group said it had entered a scheme of arrangement to purchase all of the outstanding shares in Mortgage Choice for $1.95 each, valuing the mortgage broking business at roughly $244 million.
Then, on May 26, REA Group received the go-ahead from the Foreign Investment Review Board (FIRB) before securing court approval for the deal on June 18.
“The completion of the Mortgage Choice acquisition represents an exciting milestone for our combined businesses,” chief executive Owen Wilson said.
“We’re extremely pleased to welcome the Mortgage Choice team into REA. Together, we look forward to accelerating REA’s financial services strategy to become a leading player in the home loan market.”
With more than 380 franchises across Australia, Mortgage Choice generated revenue of $22.2 million in the last six months of 2020 and recorded after-tax profit of $4.1 million.
The purchase is designed largely to accelerate REA Group’s financial services strategy by providing “a compelling opportunity” to establish a leading mortgage broking business — one that complements its existing Smartline broker network.
“This is a fantastic milestone for Mortgage Choice,” the broker’s chairman Vicki Allen said in March.
“Joining the REA network creates a significant opportunity to leverage its deep digital capabilities and expertise, combined with access to a large and engaged consumer audience.”
REA Group is down 1.27 per cent to $166.88 per share at 12:27 pm AEST.