In 2014, the REA Group acquired a 17.22 per cent stake in iProperty Group and in July 2015, increased its stake to 22.7 per cent. In November 2015, the company purchased the remaining shares at $4 per share, equivalent to AU$578 million. The deal valued the iProperty Group at about AU$750.8 million (US$532.6 million or S$749.6 million).
Speaking at a media launch to celebrate the acquisition, Arthur Charlaftis, Chief Operating Officer, International and Developer, REA Group Limited said, “This move is a game changer for our industry. The iProperty Group’s local market expertise is second to none and our teams will be working closely together to tap into the needs of buyers throughout the region and deliver even more value to our customers and consumers.”
He added that with a population of more than 500 million people, South East Asia is the world’s fastest-growing real estate market. Average property prices in Singapore and Hong Kong are already higher than in Australia, and the volume of transactions also exceeds that of Australia, with more than a million property transactions per year in South East Asia.
“The total advertising spend is at a similar level to Australia however in the key South East Asian real estate markets, online only accounts for between 2- 12 per cent of the total advertising spend.”
“We know that consumers in South East Asia are online and connected. We would therefore expect that the advertising spend will migrate rapidly towards online channels to mirror consumer media consumption.
“These factors have driven our interest in the South East Asian market, and in particular, in iProperty Group, which has a demonstrated understanding of the market, the customers and what it takes to continue to grow and succeed in this industry,” said Charlaftis.
Georg Chmiel, Chief Executive Officer of the iProperty Group said, “We have strong synergies with REA Group and this acquisition is a major accelerator as this significantly enhances the growth profile for both companies, while giving our customers, property buyers and investors the opportunity to tap into a wider market.”