REA Group engages in the provision of property and property-related services on websites and mobile apps across Australia and Asia. It operates through the Property and Online Advertising; and Financial Services segments. The Property and Online Advertising segment derives revenue from Australia, Asia and North America operations. The Financial Services segment consists of commissions earned from mortgage broking and home financing solutions offered to consumers.
Back in March 2021, REA had announced that it had entered into a Scheme Implementation Agreement with Mortgage Choice Limited (ASX: MOC) to acquire 100% of the outstanding shares for $1.95 cash per share. Mortgage Choice is a leading Australian mortgage broking business with more than 500 brokers, 380 franchises across the country, and over 30 lending partners. It has a loan book of $54 billion dollars and settlements of $11 billion dollars in the 12 months to December 2020. Mortgage Choice reported net revenue of $22.2 million and net profit after tax of $4.1 million for the 6 months to December 2020. The Scheme however is subject to customary conditions such as Mortgage Choice shareholder approval, court approval, and FIRB approval.
REA Group today confirmed with Mortgage Choice Limited (ASX: MOC) that REA has received written correspondence from the Foreign Investment Review Board (FIRB) that the Commonwealth has no objections under the Foreign Acquisitions and Takeovers Act 1975 to the proposed acquisition of Mortgage Choice by REA.
REA shares have surged 11.89% just this week, and on the back of today’s announcement, shares closed at an all-time high of $164.40 a share.
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