Domain Holdings Australia Limited (ASX:DHG) entered into a binding agreement to acquire Realbase Pty Ltd for AUD 230 million on April 1, 2022. Under the terms of the signed agreement, Domain will acquire (through one of its wholly owned subsidiaries) Realbase for cash consideration of AUD 180 million (“Upfront Consideration”) plus contingent consideration of up to AUD 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.

The acquisition price is representing 8.0x expected FY22 revenue and 20.5x expected FY22 EBITDA. The Upfront Consideration will be fully funded by a fully underwritten 1 for 12.33 pro rata accelerated non renounceable entitlement offer to raise AUD 180 million. Realbase has a strong senior management team which will continue to stay on to run the business.

Completion of the Acquisition is subject to customary closing conditions and is anticipated to occur in late April 2022. The Acquisition is expected to be EPS accretive on a pro-forma FY22 basis and also in the first full year of ownership, before synergies. Blackpeak Capital Pty Ltd. acted as financial advisor and Ashurst Australia acted as legal advisor to Domain Holdings Australia Limited (ASX:DHG).