Founded in 2004, Redfin operates a home search platform with more than 1 million listings for sale and rent, as well as a high-tech brokerage with more than 2,200 agents.
Rocket, whose flagship business is mortgage lending, intends to use technology and artificial intelligence to help potential buyers connect with its finance division and speed up deals after they close, the company said.
“Due to cross-selling synergies, we believe this price is better than what Redfin would likely have been able to achieve on its own as a residential real estate broker,” BTIG analysts wrote in a note.
Rocket shareholders will own approximately 95% of the combined company on a fully diluted basis, while Redfin shareholders will own the remaining portion after the deal closes, which is expected in the second or third quarter.
Detroit-based fintech company Rocket said it expects the combined company to achieve synergies of more than $200 million by 2027.
Redfin CEO Glenn Kelman is expected to continue to run the business.
Rocket's financial advisor is Morgan Stanley, while Redfin is advised by Goldman Sachs.
Source: Reuters
